part 9: Global entrepreneurship class
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Global Entrepreneurship Developing Global Mindset for Entrepreneurs
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part 9: Global entrepreneurship class
Transcript of part 9: Global entrepreneurship class
Global Entrepreneurship
Developing Global Mindset for Entrepreneurs
Global Entrepreneurship developing the global mindset for entrepreneurs
Class 9 Saturday June 5th 2010
Brian David Butler
Professor of international finance and global entrepreneurship with Forum-Nexus Study Abroad Guest lecturer with the IQS Business School of the Ramon Llull University in Barcelona and the Catholic University of Milan Previously Brian taught finance economics and global trade courses at Thunderbirdrsquos Global MBA program in Miami and worked as a research analyst at the Columbia University Business School in New York City
A global citizen Brian was born in Canada raised in Switzerland (where he attended international British school) educated through university in the US started his career with a Japanese company moved to New York to work as an analyst married a Brazilian and has traveled extensively in Latin America Asia Europe and North America Brian currently lives in Recife Brazil where he is teaching classes on ldquoGlobal Entrepreneurshiprdquo at the university FBV
briandbutlergmailcom
LinkedInbriandbutler
Skype briandbutler
wwwKookyPlancom
Upcoming Schedule
4 more classes Today June 12th
June 19th ndashExam
One week later ndash team project due June 26th -
25 of your grade
Attendance + Homework = 25 of your grade
30 of your grade
Schedule for today
1 Careers + international experience2 International IQ
Next class
Social networks Collaboration (micro) global entrepreneurs Clusters () International IQ ndash Brazil ndash risks
opportunities
Still timehellip
Homework assignments I f you missed any homeworkhellip you may
still submit them How Review slides from previous
lectures Look for homework assignments If you didnrsquot do anyhellip DO THEM NOW
Group Project Get together and start working today Donrsquot wait till the last second
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Global Entrepreneurship developing the global mindset for entrepreneurs
Class 9 Saturday June 5th 2010
Brian David Butler
Professor of international finance and global entrepreneurship with Forum-Nexus Study Abroad Guest lecturer with the IQS Business School of the Ramon Llull University in Barcelona and the Catholic University of Milan Previously Brian taught finance economics and global trade courses at Thunderbirdrsquos Global MBA program in Miami and worked as a research analyst at the Columbia University Business School in New York City
A global citizen Brian was born in Canada raised in Switzerland (where he attended international British school) educated through university in the US started his career with a Japanese company moved to New York to work as an analyst married a Brazilian and has traveled extensively in Latin America Asia Europe and North America Brian currently lives in Recife Brazil where he is teaching classes on ldquoGlobal Entrepreneurshiprdquo at the university FBV
briandbutlergmailcom
LinkedInbriandbutler
Skype briandbutler
wwwKookyPlancom
Upcoming Schedule
4 more classes Today June 12th
June 19th ndashExam
One week later ndash team project due June 26th -
25 of your grade
Attendance + Homework = 25 of your grade
30 of your grade
Schedule for today
1 Careers + international experience2 International IQ
Next class
Social networks Collaboration (micro) global entrepreneurs Clusters () International IQ ndash Brazil ndash risks
opportunities
Still timehellip
Homework assignments I f you missed any homeworkhellip you may
still submit them How Review slides from previous
lectures Look for homework assignments If you didnrsquot do anyhellip DO THEM NOW
Group Project Get together and start working today Donrsquot wait till the last second
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Brian David Butler
Professor of international finance and global entrepreneurship with Forum-Nexus Study Abroad Guest lecturer with the IQS Business School of the Ramon Llull University in Barcelona and the Catholic University of Milan Previously Brian taught finance economics and global trade courses at Thunderbirdrsquos Global MBA program in Miami and worked as a research analyst at the Columbia University Business School in New York City
A global citizen Brian was born in Canada raised in Switzerland (where he attended international British school) educated through university in the US started his career with a Japanese company moved to New York to work as an analyst married a Brazilian and has traveled extensively in Latin America Asia Europe and North America Brian currently lives in Recife Brazil where he is teaching classes on ldquoGlobal Entrepreneurshiprdquo at the university FBV
briandbutlergmailcom
LinkedInbriandbutler
Skype briandbutler
wwwKookyPlancom
Upcoming Schedule
4 more classes Today June 12th
June 19th ndashExam
One week later ndash team project due June 26th -
25 of your grade
Attendance + Homework = 25 of your grade
30 of your grade
Schedule for today
1 Careers + international experience2 International IQ
Next class
Social networks Collaboration (micro) global entrepreneurs Clusters () International IQ ndash Brazil ndash risks
opportunities
Still timehellip
Homework assignments I f you missed any homeworkhellip you may
still submit them How Review slides from previous
lectures Look for homework assignments If you didnrsquot do anyhellip DO THEM NOW
Group Project Get together and start working today Donrsquot wait till the last second
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
wwwKookyPlancom
Upcoming Schedule
4 more classes Today June 12th
June 19th ndashExam
One week later ndash team project due June 26th -
25 of your grade
Attendance + Homework = 25 of your grade
30 of your grade
Schedule for today
1 Careers + international experience2 International IQ
Next class
Social networks Collaboration (micro) global entrepreneurs Clusters () International IQ ndash Brazil ndash risks
opportunities
Still timehellip
Homework assignments I f you missed any homeworkhellip you may
still submit them How Review slides from previous
lectures Look for homework assignments If you didnrsquot do anyhellip DO THEM NOW
Group Project Get together and start working today Donrsquot wait till the last second
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Upcoming Schedule
4 more classes Today June 12th
June 19th ndashExam
One week later ndash team project due June 26th -
25 of your grade
Attendance + Homework = 25 of your grade
30 of your grade
Schedule for today
1 Careers + international experience2 International IQ
Next class
Social networks Collaboration (micro) global entrepreneurs Clusters () International IQ ndash Brazil ndash risks
opportunities
Still timehellip
Homework assignments I f you missed any homeworkhellip you may
still submit them How Review slides from previous
lectures Look for homework assignments If you didnrsquot do anyhellip DO THEM NOW
Group Project Get together and start working today Donrsquot wait till the last second
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Schedule for today
1 Careers + international experience2 International IQ
Next class
Social networks Collaboration (micro) global entrepreneurs Clusters () International IQ ndash Brazil ndash risks
opportunities
Still timehellip
Homework assignments I f you missed any homeworkhellip you may
still submit them How Review slides from previous
lectures Look for homework assignments If you didnrsquot do anyhellip DO THEM NOW
Group Project Get together and start working today Donrsquot wait till the last second
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Next class
Social networks Collaboration (micro) global entrepreneurs Clusters () International IQ ndash Brazil ndash risks
opportunities
Still timehellip
Homework assignments I f you missed any homeworkhellip you may
still submit them How Review slides from previous
lectures Look for homework assignments If you didnrsquot do anyhellip DO THEM NOW
Group Project Get together and start working today Donrsquot wait till the last second
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Still timehellip
Homework assignments I f you missed any homeworkhellip you may
still submit them How Review slides from previous
lectures Look for homework assignments If you didnrsquot do anyhellip DO THEM NOW
Group Project Get together and start working today Donrsquot wait till the last second
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Models
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Model ndash building blocks
CS VP
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Model ndash building blocks
CH CR
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Model ndash building blocks
R$ KR KA
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Model ndash building blocks
KP C$
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Model ndash Putting it all together
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Model ndash Putting it all together
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business model ldquocanvasrdquo
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business model ldquocanvasrdquo
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Business Model ldquocanvasrdquo
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Costs C$
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Revenues R$
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Homework Review
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Homework
In your own words tell me 5 reasons that international experience is important for your career
(ldquointernational experiencerdquo could be = travel or internships or study abroad etc)
Class discuss
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Highlighted Student responses Be a better Entrepreneur
New Business Ideas ldquoWhen traveling around the world we see
different things business ideas that may be transferable business ideas and this could be the beginning of a small business or a huge empirerdquo Roberta
Spotting business opportunities ldquoYou can identify opportunities all around the
world or thing that yoursquove seen in one place that would work in anotherrdquo Luiza
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Rememberhellip (from the 3 questions framework)
2 ldquoWhat is the trend ldquo Requires Awareness of global trends
global business models
3 ldquoWhat is great locally or abroadrdquo Requires International IQ + global
awareness
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Highlighted Student responses
Building your network ldquoGet to know more people especially in
different places of the world Increasing your friend network
ldquoItrsquos very important to maintain contact because in the future this person can either be you business partner work for you or call you to work for him introduce you to other peoplehellip
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Build your network
Nothing is more important for an international profession than their network
Most international opportunities arise because of you word-of-mouth exposure into the international market
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Highlighted Student responses
ldquoConnect-the-dots between different markets and various boundariesrdquo Arthur
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Quotes ndash famous quotes about the benefits of travel
Career Travel + International
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Benefits of travel (famous quotes)
ldquoI met a lot of people in Europe I even encountered myselfrdquo
ndash James Baldwin American novelist writer playwright poet essayist and civil rights activist
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Benefits of travel (famous quotes)
ldquoThe world is a book and those who do not travel read only a pagerdquo
ndash Saint Augustine
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Benefits of travel (famous quotes)
ldquoDonrsquot tell me how educated you are tell me how much you have traveledrdquo
ndash Mohammed
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Personal Development
Skills enhanced by global travel
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Gaining Independence
Travel will make you more capable mature and able to look after yourself ldquoIt was only after hopping on flights across
the globe and hunting around for hotels on my own that I stopped calling my Dad at the first sign of trouble I started to solve my problems myself Novel
- 5 (Less Obvious) Reasons Why Travel is Good for You | Travel Blog - Tripbase
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Why travel abroad
exposing yourself to an international lifestyle
learn to be curious about international places people cultures businesses events politics etc
Increase your international IQ every day
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
See the world differently
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
See the world differently
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Other Skills you develop traveling
Greater perspective on how others live leading to humility generosity traits
which are attractive to potential employers Teamwork ndash
as you travel the world you learn to work with others
Decision making ndash traveling solo in different parts of the
world you learn how to make decisions quickly in unfamiliar circumstances
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Other Skills you develop traveling
Initiative ndash the act of going out to see the world on your own is
taking initiative and as you travel you will find that daily acts of initiative will build your skills in this area
Communication - what better way to develop your communication skills
than to travel the world and encounter cultures of people who speak other languages and have different communication styles
Money management budgeting planning ndash going off to travel the world will improve your financial
skills as you learn to live within your budget plan for future travels negotiate hotels trans air flights and more
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Other Skills you develop traveling
Negotiation skills ndash traveling the world on a budget will force you to become a
great negotiator These skills of negotiation will definitely benefit your career after the trip is done
Adaptability ndash While traveling you will need to learn to be flexible and
accept changes quickly which are important skills to develop to an ever innovating world
Interpersonal skills ndash solo travel is lonely if you dont quickly develop a knack for
interacting with people from different cultures Traveling is one of the best means to developing interpersonal skills
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Other Skills you develop traveling
Cross cultural leadership ndash as you travel the world your skills in cross cultural
communication and leadership will be tested to the max What you learn in daily life traveling is beyond what you could learn in MBA school classrooms or in cross cultural training seminars
Self reliance independence confidence responsibility are all skills you will develop while traveling
Language skills ndash as you learn phrases for surviving daily life in other
countries you will develop a talent for how to learn languages and how to communicate non-verbally with people from other cultures
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Using international travel to boost your career ndash
Career benefits
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
1 Travel to raise your ldquopotentialrdquo international IQ
Personal Understand international news (not just hear it) Expand your world view Create global awareness Develop international outlook and global mindset Develop a greater appreciation of other cultures and of
different economic and political environments
Professional Enhance your resume Break out of your academic routine Build your network of friends from around the world Develop leadership skills
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Work abroad + salaries $$$
ldquoThe salary of an executive who will live abroad (which varies according to location and the company he works for) increases on average about 20 ldquo
Extra $$$$
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
More opportunities
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
From an employers perspective
A professional with international experience it is easier to develop corporate culture and motivate people since he is usually very motivatedldquo
Marcos Ramos newly named president of Alcoa Europe
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Easier to hire
ldquoYoung people now need to shift the so-called global mindset a skill set that consists mainly of understanding communicating up and manage people of different origins It is a decisive experience in deciding to hire a person
Marcos Ramos newly named president of Alcoa Europe
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Quotes McKinsey - A culture of moving
Half of our partners and more than 20 percent of our associates have worked outside their home region Each year more than 200 consultants take short- or long-term transfers And last year 42 percent of non-partners relocated on an engagement loan Theyrsquore rewarded with experiences that enrich their career -
Live and work around the world | Global | Travel | McKinsey Careers
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Need to be global (to be ready) In the past it was the experience
that left a professional ready to go abroad Now the logic is the oppositehelliphe needs to go overseas to get readyldquo
Prof Brooks a professor of the Graduate School of Advertising and Marketing (ESPM Sao Paulo Brazil)
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Careers - ARE YOU READY (for global prime-time)
Skills enhanced by global travel
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Are you ready (for an international career)
More than eight years of adulthood administrator Sao Paulo Rodrigo Aires were spent abroad
At 24 he moved to Mexico
Then lived in Puerto Rico and Spain
He now lives in Hong Kong
With 17 countries in the curriculum and only 32 years old Aires represents a generation that goes around the five continents with the same ease of one who takes a taxi
These are called global executives professionals with the potential to assume leadership positions are invited to spend periods in other countries periods that can last from few months to several years
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Skills needed in the economy economic and geographical
knowledge cross-cultural communication skills analytical skills flexibility an understanding of and familiarity
with local customs an ability to adapt to new
circumstances language skills
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Skills for a resume
Who thinks international experience (travel study abroad etc) is beneficial to
1 Vision 2 Passion 3 Purpose 4 Adaptability 5 Leadership Skills 6 Networking Savvy 7 Determination 8 Positive attitude
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Skills
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Your Resume (CV) needs to stand out
Darwinian war for talent is now so keen that the gap year - once a straightforward mark of distinction - now has to be absolutely extraordinary to single a graduate out
Straightforward canoeing up the Amazon is no longer enough The graduate has to have paddled backwards
httpnewsbbccouk2hiuk_newsmagazine3530906stm
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Resume (CV) tips
See my blog posting on how to include study abroad experience on your resume here httpforumnexuswordpresscom20091029resume-cv-building-with-study-abroad
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Career Options (for global travelers)
Question
If you already have invested in your International IQhellip And if you intrsquol IQ is already HIGHhellip then what career options might you consider
What careers might be open to you (that might not be open to others)
Some ideashellip1 International business 2 Import export 3 Global Entrepreneur 4 Diplomat5 Intrsquol Journalist
reporter6 Work at United Nations
as Politician Mediator 7 International Lawyer8 Political activist9 Teacher (history
geography etc)10 Economist11 What else
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Some interesting career options you MIGHT NOT have consideredhellip
Career Options (for global travelers)
1 Strategy consultant management consultant - Examples McKinsey Bain Boston Consulting Group etc
2 Global Macro trader Hedge funds Ex Jim Rogers (see below)
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Management Consultant What is it you do
Consultants sell knowledge and the skill and expertise of their employees
Basically consultants are hired by a company government or a nonprofithellipto help assess its problems plan its future or improve operation efficiency and
profits
see more from Vault com
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
International Career Option ndash Management consulting
unique career that offers the chance
to work within many industries and companies
Work directly with CEOs and travel throughout the country
and the world
see more from Vault com
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
International Career Option ndash Global macro (hedge fund) investor
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
International Career Option ndash Global (macro) investor
More about investors + the benefits of global travel will be discussed below (see section on ldquo3 stepsrdquo + how to benefit from increased international IQ by investing
see more httpglobotrendspbworkscomglobal-macro-hedge-funds
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
3 steps process to boost actual international IQ + benefit from it
How to
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Using international travel to boost your career ndash 3 steps
1 Increase ldquoPotentialrdquo Intrsquol IQ
2 Increase ldquoActualrdquo Intrsquol IQ
3 Benefit from your increased International IQ
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Using international travel to boost your career ndash First 2 stepshellip
1 Increase ldquoPotentialrdquo Intrsquol IQ Much like ldquopotential GDPrdquo in economics which sets the
constraints for how much the economy can grow Can be increased with Travel Study abroad
Volunteer abroad Work abroad Language lessons morehellip
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy which may be
below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
(could increase BOTH potential amp actual IQ same time)
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
1 Increase your ldquoPotentialrdquo international IQ
Travel Long-term travel Open your mind learn about politics
geography history culture ldquowhatrsquos going onrdquo etchellip
Work Abroad
Study abroad (increases BOTH potential amp actual IQ) Get a masters from another country Short term ndash get a certificate
Volunteer abroad Peace corps etc
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Travel + potential Intrsquol IQ
Benefits of LONG-TERM (around the world) travel Defined as 3 months or more
Why do around-the-world extended travel Rather than short trips (many) What are the advantages of doing one LARGE round the world travel instead of many short 1 week travels
Class discusshellip
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Travel + potential Intrsquol IQ
Short-term travel is likely short-distance travel
Because the world is so BIG that short-term travelers will likely never travel to Thailand Laos Malaysia Indonesia etc (unless they are from that part of the world)
So when news from the other side of the globe hits she will have no travel-reference to relate the news back to her personal experiences
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Travel + potential Intrsquol IQ
Without the experience of traveling across you miss the context of place Short term travelers if they do happen to
travel long-distances likely only see a pin-point on a map and you lack the context of moving from one place to another across the map
In my experience driving across the border from Malaysia to Thailand or Laos to Thailand was more educational than hellip the tourists that just flew into Phuket and went directly back to England (and lacked the transition context of the changing landscape people religion etc)
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Benefit of increased Potential ability to make sense of Global News
Increased potentialhellip means that when you DO come across international newshellip it will make more sense to you
Previously having traveled somewherehellipMakes it easier to understand (later) when you read news about that place
For examplehellip
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
hellip a recent headlinehellip
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Questions (about headline)
How close (geographically culturally economically) are Phuket + Bangkok
If you had traveled there you would knowhellip
This is about your POTENTIAL
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Its FAR (distance culturally + physically)
About 900 km- ldquoare you talking of a hire car and driving yourselves if so you would be mad roads are crowded and traffic is hectic The best thing is to fly from Bangkok to Phuket there are all sorts of cheap fares and you would get there aliverdquo
Trip Advisor
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Using international travel to boost your career ndash 3 steps
2 Increase ldquoActualrdquo Intrsquol IQ Much like ldquoactual GDPrdquo of an economy
which may be below (with room for growth) at equilibrium or above the potential GDP (causing meltdown)
Can be increased by Reading Economist magazine weekly watch BBC international news etchellip
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Using international travel to boost your career ndash 3 steps
After Traveling (or Studying Abroad Working Abroad etc)hellip to increase your Potentialhellip
The next step is to increase your ACTUAL international IQhellip How
For this you need to read read readhellip
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Subscribe IN PRINT (not online)
Note it takes about 5 hours to read it per week Invest 1 hour per weekday to raise your ldquoACTUALrdquo international IQ up to your ldquopotentialrdquo
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Or LISTENhellip
Free monthly AUDIOCASThellip
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Step 3
3 Invest to - Benefit from increased International IQ
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Step 3
3 Invest to - Benefit from increased International IQ
Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur Trend (get ahead of it) Transferrable idea (from
abroad) See import export opportunity Invest in stock market commodities currency
countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined belowhellip
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
The adventure Capitalist
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
The adventure Capitalist ndash success investing globally
Rogers co-founded the Quantum Fund During the following 10 years the portfolio gained 4200 while the SampP advanced about 47[5] It was one of the first truly international funds
Co-founded with George Soros In 1992 the lead fund Soross Quantum Fund
became famous for breaking the Bank of England forcing it to devalue the pound Soros had bet his entire fund in a short sale on the prediction that the British currency would drop in value (it did) a coup that netted him a profit of $1 billion
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
The ldquoAdventure Capitalistrdquo Between January 1 1999 and January 5
2002 Rogers did another Guinness World Record journey through 116 countries covering 245000 kilometers with his wife Paige Parker in a custom-made Mercedes The trip began in Iceland which was about to celebrate the 1000th anniversary of Leif Erikssons first trip to America On January 5 2002 they were back in New York City and their home on Riverside Drive His route around the world can be viewed on his website jimrogerscom He wrote Adventure Capitalist following this around-the-world adventure It is currently his best selling book
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
The ldquoInvestment Bikerrdquo
From 1990 to 1992 he traveled through China again as well as around the world on motorcycle over 100000 miles (160000 km) across six continents which was picked up in the Guinness Book of World Records He tells of his adventures and worldwide investments in Investment Biker
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
The adventure Capitalist
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Summary
1 Travel to - Increase ldquoPotentialrdquo Intrsquol IQ2 Read to - Increase ldquoActualrdquo Intrsquol IQ3 Invest to - Benefit from increased
International IQ
take benefits of your hard work Invest in career advancement Invest in new job Take advantage of opportunity as entrepreneur - Trend (get ahead of it) Transferrable idea (from abroad) See import export opportunity Invest in stock market commodities currency countries (or bet against them)hellip the so called ldquoglobal macrordquo strategy of investinghellip as outlined abovehellip
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
International IQ
A look at China- USA
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
ChimericaChina and America joined by trade amp finance
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
International IQ update
We have previously covered Europe + the situation in Greece (and Portugal Italy Spain etc)
This class we will briefly discuss another global relationship you need to be aware of that of the USA-and China
Why To conduct global business you need to be
aware of key important developments and the potential for changes
Next class we will discuss how this all impacts Brazil + Brazilian business people
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Note
We did NOT cover all of the following slides
Class discussion was just a summary of the issue and an introduction All slides are included here just for your referencehellip
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Summary of class discussion
1 ldquoChimercardquo introduced - with statistics and observations
2 About china ndash 13 billion people 300mm upper middle class 900mm lower class
3 Controls ndash migration controls no slums ndash fears of removing controls currency controls money flow controls savings options limited one child policy retirement
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Summary of class discussion
4 Threats to china- $2trillion in foreign reserves with about $1 trillion loaned to the US government at very low interest rates What happens if US dollar depreciates Is it in Chinarsquos interest to appreciate currency NO Would lose value of investment
5 History 1997 Asian Crisis is key afterwards had fear of accepting foreign capital Desire to keep exchange rate low for exports
6 Result is that since 2000 massive flows of money from worldrsquos Poor to rich countries
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Summary of class discussion
7 Not just china Dollar bloc of countries targeting US dollar but Brazil is outside
8 From USA perspective needs cheap financing demographics 2 wars health care etc
9 Flood of Cheap credit ndash one Cause of credit crisis ndash ldquoUSA hung self noose supplied by Chinardquo
10Future underling ldquoImbalancesrdquo unchanged ndash but will fixed flexible change again How
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Take aways
Key points from class discussion that the US-China relationship is important only since 1997 has the situation been that money
flowed en-masse from poor countries to rich ones (often called ldquoglobal imbalancesrdquo)
A ldquodollar blocrdquo of countries exists and Brazil is not one of them
Massive quantity of cheap credit flowing from poor countries to the US is likely not sustainable nor desirable (in the long term)
What will happen when it ends We already have seen the ldquocredit crisisrdquo (2007-now)
as likely partially caused by this flood of cheap credit
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
slides
The following are select slides from my lecture
Recommended further reading
Martin Wolf ldquoFixing Global financerdquo Niall Ferguson ldquoA financial history of the
world the ascent of moneyrdquo
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Observations about China USA China
13 billion people Approx 96o0000
km2
USA 03 billion people Approx 96o0000 km2
Observation China has about 4 times as many people in a country about the same size as the USA but with almost all of those people in frac12 of the country (East)
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Observations about China USA China
Of the 13 billion peoplehellip
approximately 300 million are middle to upper classhellip approximately the same population as the USA or more people than the entire population of Brazil
it is VERY NICE In cities like Shanghai or Beijing the quality of life is VERY HIGH
httpenwikipediaorgwikiList_of_countries_and_outlying_territories_by_total_area
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
The ldquoAdventure Capitalistrdquo He is quoted as saying
If you were smart in 1807 you moved to London if you were smart in 1907 you moved to New York City and if you are smart in 2007 you move to Asia
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Observations about China USA Chinarsquos main concern
Feeding 13 billion people
What would you do if you had 13 billion mouths to feed
Sustainable development andhellip
Controlshellip
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Observations about China USA One Child policy
makes sense if you consider the object ndash slow down population growth
But troubling is the demographic trend of too many men
Issues lack of options for retirement planning old age care
httpwwwtimesonlinecoukmultimediaarchive00065TIM041FshrhD22_65733agif
ldquoIN CHINA they are called ldquobare branchesrdquo young men without wives or offspring frustrated rootless drifting disruptive And there are a hell of a lot of them Five years ago the Chinese Academy of Social Sciences in Beijing calculated that one Chinese man in six was unlikely to find a female partner Thatrsquos about 111 million unattached males In other words there are twice as many bare branches in China as there are people in the whole of Britain
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Observations about China USA Controls on the
movement of people from the interior to the cities has its positive impact no slums around the mega cities (as we have in Brazil India Mexico etc) In China these ldquofavelasrdquo do not exist
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Observations about China USA But the fear is if the
controls were to be removedhellip
With 300 million in upper middle class and 900 million in lower classhellip
The cities might get crowded FAST as people from the interior might move in mass to the cities looking for work (as happened here in Brazil Mexico India etc)
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Observations about China USA Other controls
Capital controls ndash money in money out of the country is controlled (according to Mundell Trilemma this control is necessary to maintain the other control
Currency control ndash appreciation depreciation is targeted to the US dollar
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Chimerica defined
Chinas economy now is closely intertwined with the US
The US-China economic relationship has become arguably the worlds most important
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Chimerica
An important trading bloc with
about 110th worlds land surface 14th worlds population 13rd worlds economic output more than 12 of worlds economic
growth over past 8-10 years The US accounts for 15th of all Chinese
exports (their biggest trading partner)
Niall Ferguson ldquoA financial history of the world the ascent of moneyrdquo
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Chimerica
Chinese savers American borrowers spenders
The Chinese model relies on funneling savings into limited
options at low rates Personal savings channels for retirement
and health care are limited Companies pay little dividends The result is a large savings rate
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Chimerica
Chinese savers American borrowers spenders
The USA model (opposite) consumers spend rather than save (at least up until the
crisis of 2007-) In 2007 the US needed to borrow $800 billion more than
$4 billion every working day (mostly borrowed from foreigners)
According to Martin Wolf the US became the superpower of global borrowing
China became the banker to the US creating a perverse world in which money flowed from the worlds poor to the rich (the Average US earned $34k per year while the average Chinese earned just $2k per year)
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
A flood of cheap credithellip
hellipMostly from Asia mostly after SE Asian Crisis of lsquo97-98
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
America stops saving
In America savings fell from around 10 of disposable income in the 1970s to 1 after 2005
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Cheap credit hellip
Leads to a housing bubble which bursts in 2007
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
China exports America imports
Chinas exports goods exports went from $250 billion in 2000 to $1430 billion in 2008
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
US imports
httpenwikipediaorgwikiFileUSimportsgs1960-2004gif
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
China exports America imports
SOURCE US Census Bureau Foreign Trade Division httpwwwcensusgovforeign-tradebalancec5700html
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Foreign reserves = IOUrsquos (2008-09)
httpswwwciagovlibrarypublicationsthe-world-factbookrankorder2188rankhtml
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Reserve Accumulation + global imbalances
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Legacy of the Crises
By March 2007
Both Taiwan amp South Korea held more reserves than the entire Eurozone
When Almost all between 2000-2007
Martin Wolf book ldquoFixing Global Financerdquo
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Reserve Accumulation + global imbalances
See the inverse relationship
-Current account balances
-Reserve accumulation
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Dollar Bloc Not just China
Perhaps China manipulates its currency but so too do Singapore Argentina Saudi Arabia and any nation that either pegs its currency maintains a tight trading band or oversees a ldquomanaged floatrdquo system Even Hong Kong routinely ranked as the worldrsquos freest economy by the Heritage Foundation manipulates its currency It has to maintain its link to the US dollar
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
The ldquodollar blocrdquobull ldquocurrencies either pegged to the dollar or more or less
actively managed against it (a group that includes Japan)rdquo Oil Exporters
Bahrain Oman Qatar Saudi Arabia UAE (Dubai included)
China Japan Russia Singapore Taiwan Malaysia Hong Kong Thailand India Others Ecuador Panama morehellip Used to be ArgentinaSources figure 66 from Wolf ldquoFixing Global Financerdquo
And Economistcom May 23 2009 ldquoMonetary Union in theGulfrdquo
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Resource httpwwwroubinicom
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Homework
Sorry
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
Brazil
How does the China-America relationship outlined above effect Brazil
Describe in 1 page or less
- Global Entrepreneurship
- Global Entrepreneurship developing the global mindset for ent
- Brian David Butler
- wwwKookyPlancom
- Upcoming Schedule
- Schedule for today
- Next class
- Still timehellip
- Business Models
- Business Model ndash building blocks
- Business Model ndash building blocks (2)
- Business Model ndash building blocks (3)
- Business Model ndash building blocks (4)
- Business Model ndash Putting it all together
- Business Model ndash Putting it all together (2)
- Business Model ndash Putting it all together (3)
- Slide 17
- Slide 18
- Slide 19
- Slide 20
- Slide 21
- Slide 22
- Slide 23
- Slide 24
- Business model ldquocanvasrdquo
- Business model ldquocanvasrdquo (2)
- Slide 27
- Slide 28
- Slide 29
- Slide 30
- Business Model ldquocanvasrdquo
- Slide 32
- Slide 33
- Slide 34
- Costs C$
- Revenues R$
- Homework Review
- Homework
- Highlighted Student responses Be a better Entrepreneur
- Rememberhellip (from the 3 questions framework)
- Highlighted Student responses
- Build your network
- Highlighted Student responses (2)
- Quotes ndash famous quotes about the benefits of travel
- Benefits of travel (famous quotes)
- Benefits of travel (famous quotes) (2)
- Benefits of travel (famous quotes) (3)
- Personal Development
- Gaining Independence
- Why travel abroad
- See the world differently
- See the world differently (2)
- Other Skills you develop traveling
- Other Skills you develop traveling (2)
- Other Skills you develop traveling (3)
- Other Skills you develop traveling (4)
- Using international travel to boost your career ndash
- 1 Travel to raise your ldquopotentialrdquo international IQ
- Work abroad + salaries $$$
- More opportunities
- From an employers perspective
- Easier to hire
- Quotes McKinsey - A culture of moving
- Need to be global (to be ready)
- Careers - ARE YOU READY (for global prime-time)
- Are you ready (for an international career)
- Skills needed in the economy
- Skills for a resume
- Skills
- Your Resume (CV) needs to stand out
- Resume (CV) tips
- Career Options (for global travelers)
- Career Options (for global travelers) (2)
- Management Consultant What is it you do
- Slide 75
- International Career Option ndash Management consulting
- International Career Option ndash Global macro (hedge fund) invest
- International Career Option ndash Global (macro) investor
- 3 steps process to boost actual international IQ + benefit f
- Using international travel to boost your career ndash 3 steps
- Using international travel to boost your career ndash First 2 steps
- 1 Increase your ldquoPotentialrdquo international IQ
- Travel + potential Intrsquol IQ
- Travel + potential Intrsquol IQ (2)
- Travel + potential Intrsquol IQ (3)
- Benefit of increased Potential ability to make sense of Global
- hellip a recent headlinehellip
- Questions (about headline)
- Its FAR (distance culturally + physically)
- Using international travel to boost your career ndash 3 steps (2)
- Using international travel to boost your career ndash 3 steps (3)
- Subscribe IN PRINT (not online)
- Or LISTENhellip
- Step 3
- Step 3 (2)
- The adventure Capitalist
- The adventure Capitalist ndash success investing globally
- The ldquoAdventure Capitalistrdquo
- The ldquoAdventure Capitalistrdquo (2)
- The ldquoInvestment Bikerrdquo
- The adventure Capitalist (2)
- Summary
- International IQ
- Chimerica
- International IQ update
- Note
- Summary of class discussion
- Summary of class discussion (2)
- Summary of class discussion (3)
- Take aways
- slides
- Observations about China USA
- Observations about China USA (2)
- The ldquoAdventure Capitalistrdquo (3)
- Observations about China USA (3)
- Observations about China USA (4)
- Observations about China USA (5)
- Observations about China USA (6)
- Observations about China USA (7)
- Chimerica defined
- Chimerica (2)
- Chimerica (3)
- Chimerica (4)
- A flood of cheap credithellip
- America stops saving
- Cheap credit hellip
- China exports America imports
- US imports
- China exports America imports (2)
- Foreign reserves = IOUrsquos (2008-09)
- Reserve Accumulation + global imbalances
- Legacy of the Crises
- Reserve Accumulation + global imbalances (2)
- Dollar Bloc Not just China
- The ldquodollar blocrdquo
- Resource httpwwwroubinicom
- Homework
- Brazil
-
