Quote of the Day, related to the post below about the rising middle class in India:
When markets and human values work together, the gains are immense. The market economy and capitalism are among the greatest enablers of civilization. Our lives are comfortable instead of wracked with hard physical labor, chronic malnutrition, and massive losses of women and babies during childbirth, to cite just a few features or earlier times.
Imagine a time traveler from the eighteenth century visiting the life of Bill Gates. He would witness television, automobiles, refrigerators, central heating, antibiotics, plentiful food, flush toilets, cell phones, personal computers, and affordable air travel, among other remarkable benefits. But the most impressive features of Gates’s life, from a historical point of view, are shared by most middle-class Americans today.
~From George Mason economist Tyler Cowen’s book “The Inner Economist”
The chart above (click to enlarge) is from a McKinsey Global Institute study “The Rise of India’s Consumer Market” from May 2007, showing the expected changing patterns of 5 different income groups in India (shown above in constant 2000 Indian rupees), below in US dollars:
Deprived: Less than $2,250 in annual income
Apsirers: $2,250 to $5,000
Seekers (Middle Class): $5,000 to $12,500
Strivers (Middle Class): $12,500 to $25,000
Globals: > $25,000
1. The “deprived group” is expected to decrease from 77% of the Indian population in 1985 to only 3% by 2025.
2. India’s middle class (seekers and strivers) is expected to increase from 8% of the population in 1985 to almost 60 percent of the population in 2025.
Conclusion: As a result of market capitalism and globalization India will experience a dramatic rise in its middle class and a significant reduction in its low-income, deprived group. Far from a story of the “rich getting richer and the poor getting poorer,” free market capitalism in India will result in the “rich getting richer” and the “poor getting richer,” the same story as the U.S.
(HT: Ray Titus and Sanil Kori)
Indian IT and outsourcing companies earn revenues in dollars but pay most of their costs in rupees. Profit margins for these companies have been squeezed lately because: a) wages have been rising by 10-15% in India because of the high demand for workers and b) the dollar is trading at a 9-year low vs. the India rupee and has fallen by almost 15% in the last year.
Solution? Outsource to the U.S.
MUMBAI–Tata Consultancy Services plans to open two computer services centres in the U.S. in one of the biggest expansions by an Indian information technology outsourcing company in a developed market.
India’s largest computer services company, part of Tata Industries, said the first centre of 500-1000 people would open in Cincinnati, Ohio, by the end of this year or early next year, with the second to follow in late 2008 or early 2009 at an undisclosed location.
Bottom Line: Globalization works both ways.
Manhattan Institute fellow John McWhorter asks an interesting question and makes an interesting proposal:
Imagine if after the Jena incident, black kids had just taken the nooses down and kept on hanging out under that tree. Why is that such an unthinkable alternative to shouting it to the rooftops only to watch similar things keep happening nationwide anyway?
Hence my modest proposal. The next time — and there will be one, and another, and another — let it go. Not because it’s okay, but because that is the way to discourage it from happening.
PHOENIX – Woes in the home construction and mortgage industries grab the headlines, but a new report shows continued strength in Arizona’s economy, with unemployment at a record low rate in September of just 3.3%, down from 3.7% in August and matching the previous low of 3.3% set 40 years ago in 1967.
Michele Hernandez boasts that 95% of her teenage clients are accepted by their first-choice school. Her price: As much as $40,000 a student.
Read about it in the current issue of Business Week.
A discussion was generated recently based on this post about grammar, and I corrected the spelling of “nitpicking” to “nit-picking,” at the suggestion of a commenter.
Update from NYTimes: The Shorter Oxford English Dictionary, the scaled-down, two-volume version of the mammoth 20-volume O.E.D., just got a little shorter. With the dispatch of a waiter flicking away flyspecks, the editor, Angus Stevenson, eliminated some 16,000 hyphens from the 6th edition, published last month.
I’m not sure if the hyphen was elminated from “nit-picking,” but chances are pretty good that it was one of the 16,000?….
Original Craigslist post: “Okay, I’m tired of beating around the bush. I’m a beautiful (spectacularly beautiful) 25 year old girl. I’m articulate and classy. I’m not from New York. I’m looking to get married to a guy who makes at least half a million a year.”
From a repsonse on Craigslist (below original post): “Cutting through all the B.S., what you suggest is a simple trade: you bring your looks to the party and I bring my money. Fine, simple. But here’s the rub, your looks will fade and my money will likely continue into perpetuity…in fact, it is very likely that my income increases but it is an absolute certainty that you won’t be getting any more beautiful!”
New response on Craigslist: “Though you did not mention the details of your occupation, it is clear that you are an investment banker and not a trader, as any good trader would understand that human courtships are based upon a semi-efficient open market, and not an investment banking cartel. However, your inability to grasp the realities of the dating market is not surprising, given that you have successfully employed the tools of collusion and market manipulation rather that true acumen in your supposed wealth generation.”
TOULOUSE, France (AP) — Nearly two years late, Airbus finally delivered its first A380 superjumbo on Monday, a revolutionary behemoth that includes luxury suites equipped with comfy double beds (pictured above).
Singapore Airlines fitted its jet with 471 seats configured in three classes: 399 economy class seats on both decks, 60 business class seats on the upper deck and 12 luxury suites on the main deck (two with double beds).
A standard return fare for a suite, created by French luxury yacht designer Jean-Jacques Coste, will cost around $7,160 on the inaugural Singapore-Sydney route. That’s about 20-35% more than the current top-class fare. Each suite comes with sliding doors and self-adjustable roller blinds for privacy — with only a small fabric screen at the bottom to allow cabin crew to check on passengers.
Question: Will this have any effect the “Mile High Club?” New rules? Increased membership?