Crisis Shadowing Asia Again?
Since May 22, when U.S. Federal Reserve chairman Ben Bernanke made indications that there would be adjustments to their quantitative easing policy, which could in turn potentially cause interest rates to rise, currencies in emerging economies have sharply devalued against the U.S. dollar. To make things worse, slowing foreign demand and sharply rising oil prices have further deteriorated many countries' current accounts and trade deficits have accelerated the depreciation of some currencies. Currencies of emerging economies are facing the most severe challenge since the 1997 Asian Financial Crisis.
In India, depreciation of the rupee has spun out of control, putting the central bank on high alert. The Indian Government and central bank have unveiled numerous policies that act to restrict the transfer of money abroad and similarly restrict overseas investment while raising the import taxes on precious metals such as gold and silver. In order to stabilize the currency, the central bank increased interest rates from 8.25 percent to 10.25 percent.
However, these efforts have had limited effects. On August 22, the exchange rate of the U.S. dollar to the rupee rose to over 65 rupees to the dollar, indicating that the rupee had devalued by nearly 20 percent compared to early May. Cash is flowing out of the country and the stock market has also taken a hit, with SENSEX dropping by over 10 percent.
However, India is not alone. Indonesia and Thailand also face similar problems. As these emerging countries fall into the middle income trap, problems such as inadequate infrastructure, corruption, widening wealth gaps and poor standards of education will start to emerge. Where the future of the emerging currencies lies becomes increasingly unclear.
Real-Name Registration System
China's real-name registration system for all new telephone users went into effect on September 1. Real-name registration system is a universal policy across the world to control illegal practices. But it doesn't necessarily spell the end of junk messages and nuisance phone calls.
For instance, those omnipresent advertising messages for real estate, beauty products and fake invoices are unlikely to be deterred by real-name registration. In addition, many junk messages that have flourished in recent years are the result of the conspiratorial actions of telecoms operators and some companies. In this regard, the system alone will be unable to control this profit-driven impulse.
Supporting supervisory measures and strict implementation of the regulation are essential. The government should strengthen protection of phone users' personal information, preventing their private details from falling into the wrong hands.
Xu Shaoshi, head of China's National Development and Reform Commission, recently announced that China will launch pilot property tax programs in more cities. He affirmed that the policy will be scheduled for the second half of 2013.
Thanks to the reform and opening up, Chinese citizens are richer than ever before. However, their property forms are so limited that real estate is the major—and almost the only—form for them. Now an additional housing tax is on the way, meaning that ordinary citizens will have to pay extra for their sole property.
China's current policy states that a person who buys an apartment has to pay 12 taxes and more than 50 fees. Therefore, imposing a housing tax has the aura of double taxation.
The imposing of a housing tax also arises concern over property risk. Currently, the trend of migration is on the rise in China. And most of these people are the country's newly rich elites. Many of them continue to work in China with a foreign nationality. They put their careers in China but purchase property outside of China. This reflects their concerns over the controllability and risk of their properties in China.
The Dream That Changed a Nation
On August 28, 1963, the African American civil rights leader Rev. Martin Luther King Jr. delivered his world renowned speech titled I Have a Dream in front of the Lincoln Memorial to 250,000 people who took part in the march on Washington for Jobs and Freedom.
In the 50 years since the speech was made, King has been removed from the FBI blacklist as a dissent and is widely recognized as a civil rights movement hero by not only Americans, but also people the world over. His birthday has been designated as a national holiday in America and a statue commemorating him stands among those of several American presidents in Washington. The racial segregation he fought against has weakened and the country's first African American president Barack Obama is currently serving his second tenure.
However, despite all the progress achieved, Vincent Harding, an African American historian, told China Newsweek that the United States is still far from realizing King's dreams. Since slavery had a history that lasted over 300 years in America, it's unrealistic to expect the elimination of racial discrimination within only 50 years. As King declared in his speech, "we need to fight constantly and regard the March on Washington not as the end but as a new beginning."