Society and Information Technology in Second Life

Wednesdays, August 29 - December 12 , 2007, 4-6, SLT/PT, 7-9 pm ET on Berkman island in Second Life

 Course homepage - http://socinfotech.pbwiki.com

 

Instructor: Scott MacLeod (not on Harvard's faculty) = Aphilo Aarde (in Second Life)

http://scottmacleod.com/papers.htm

 

 

 

Nov 21 2007 Soc and Info Tech Class Transcript

 

 

 

[16:07]  You: :)

[16:08]  Boston Hutchinson: You may have to live with a new experience, Aphilo

[16:08]  You: Hello Andromeda

[16:08]  Andromeda Mesmer: Hi Aphilo -- I have been trying to get to class for 10 minutes now.

[16:08]  You: Happy Easter in a beautiful, almost halloween, garb.

[16:08]  Boston Hutchinson: I was just saying that in Croquet, the equivalent would be to be "rabitted"

[16:08]  Andromeda Mesmer: I'll send Geda a TP

[16:08]  You: Yes...

[16:08]  You: ok

[16:08]  Andromeda Mesmer: She is trying to come too -- failed as well.

[16:09]  You: SL has been becoming less problematic . . .

[16:09]  Rain Ninetails: I would not let me in for the last 5 hours.

[16:09]  Rain Ninetails: just now at 4 it worked

[16:09]  Andromeda Mesmer: Wow, Rain -

[16:09]  You: I had one similar problem in August, wehn I was teaching this class, as well.

[16:10]  You: Beautiful streaming feathers

[16:10]  You: Well, let's begin.

[16:11]  You: and return to examining Globalization and Finance

[16:11]  You: What's the most important aspect of the capitalist economy?

[16:12]  You: Capital, of course.

[16:12]  You: And what is capital?

[16:12]  You: Capital is money - a symbol of value - but it isn't just money.

[16:12]  You: It's money that is invested with an expectiation of profit.

[16:13]  You: People invest capital to get a return.

[16:13]  You: So in this systme, money makes money.

[16:13]  You: And financial markets are markets that trade money.

[16:14]  You: And for a long time, in principle, most money would be invested in goods and services, and machines, etc, in the past few centuries, for example.

[16:15]  You: And money invested in these goods and services, differed, in a sense, from money invested in stocks and bonds, currency, and treasury bonds.

[16:15]  You: So now, in capital markets, money from anywhere can be invested anywhere.

[16:16]  You: Savings today in a a bank - doesn't make any money in a bank

[16:16]  You: And for the bank, all that money which you and i put in our accounts is invested in financial markets

[16:17]  You: And all this money then becomes part of electronic circuits

[16:17]  You: and is exchanged

[16:17]  You: according to wherever is most profitable, within regulations.

[16:18]  You: And in the last 20 or so years, deregulation and liberalization has allowed capital to be deinvested.

[16:18]  You: On October 27, 1987, the city of London fully liberalized.

[16:19]  You: From that time forward, investors in London could invest money from anywhere to anywhere.

[16:19]  You: A Singapore account could invest in Buenas Aires stockes.

[16:19]  You: And that act of liberalization traslated a huge amount of money into electronic circuits around the world.

[16:20]  You: In the year 2000, in the U.S. financial transactions in STocks and Bonds reaching 100 trillion dollars, 10 tiems GDP

[16:21]  You: And currency market exchanges consisted of 2.3. trillion dollars per day in transactions

[16:21]  Gwyneth Llewelyn is Offline

[16:21]  You: more than the GPD of France and about Germany's GDP.

[16:22]  You: That's a huge amount of money transacted every day - an unprecendented volume

[16:22]  You: And compare that with 15 years ago - in terms of

[16:22]  You: 25 years ago - in terms of world exports, Goods and Services and currency exchange

[16:23]  You: IN 1979, the ration of currency exchange to exports was 12:1

[16:23]  You: People would use money to buy currency, rather than exports

[16:23]  You: And in 1997 the ratio was 60:1 currency exchange to exports.

[16:23]  You: the data is in the literature.

[16:24]  You: So investement in securities has been driven by making money in financial markets.

[16:24]  You: And this has rippled through the real economy.

[16:25]  You: How you make money is different process, thatn for example, making and buying and selling shoes once was, before liberalization and deregulation.

[16:26]  You: So about Deregulation -u ntil 1999, the U.S. couldn't merge invetment banks and banks of deposit

[16:26]  You: Under the Clinton administration, a big change occurred

[16:26]  You: and this became easier.

[16:26]  You: Hedge funds, for example, are usually located off shore

[16:27]  You: The Caymen islands has one of 3 of the largest financail markets in the world

[16:27]  You: And it tops the list of money laundering countries

[16:27]  You: Hedge funds are special investment funds, normally offshore,

[16:28]  You: where the rich can invest - 10 or 100 million, for example - outside the normal electrnoic circuits, and get very high yields.

[16:28]  You: What banks do it place this their moneis in hedge funds

[16:28]  You: And that became much easier

[16:28]  You: 2 exmaples of hedge funds.

[16:28]  Boston Hutchinson: Sometimes the hedge funds lose.

[16:29]  You: Yes, they are very risky.

[16:29]  You: George Soros for example - a financial, speculative guru

[16:29]  You: has an investment fund for long term capital management

[16:29]  You: And lost in very big ways

[16:30]  You: And 2 Nobel Prize winners lost 4 billion dollars

[16:30]  You: from banks, and they had to pay it bck to the bank, and the got a bailout

[16:30]  You: So all kinds of mechanisms became legal in 1987

[16:31]  Andromeda Mesmer: In that particular case, a consortium had to bail them out -- which included the very cautious Warren Buffett who had been laughed at for his conservative ways.

[16:31]  You: which can now be used to move money around.

[16:32]  You: Yes, - liberalization and deregulation borught together an itneresting collection of investors to handle such problems

[16:32]  You: The crash of 1987 was unrelated to liberaliztion.

[16:32]  You: The crash was related to computers - programs were oriented

[16:32]  You: to buty and sell, and they 'snowballed' in a way.

[16:33]  You: GLOALIZATION OF FINANCIAL MARKETS

[16:33]  You: MECHANISMs

[16:34]  You: (Deregulation, and liberalization do involve a lack of values)

[16:34]  You: 1) The elimination of barriers occurred and was the most important mechanism)

[16:35]  You: not 100% of the barries, but there was a tendency toward equalization and controls were lessened

[16:35]  You: consequently in the late 1980s and 1990s, investments by mutal funds and investors increased by a factor of 10

[16:35]  You: 2) the Development of technological infrastructure occurred

[16:35]  You: A) telecommunications

[16:36]  You: B) massive computers

[16:36]  You: Since you only have seconds to make or lose billions of dollars, a small difference in value can be decisive

[16:36]  You: You have to be able to sell instantaneously

[16:36]  You: And computers allow you to do this constantly

[16:37]  You: For these you need mathematical models that execute strategies

[16:37]  You: You give the programs instructions about what you want

[16:37]  You: So between the investment decision and the buy , there is a powerful mathematical model

[16:38]  Andromeda Mesmer: The strategies have to be constantly changed, because once other traders figure out what you are doing, you will lose the advantage of surprise.

[16:38]  You: 3) interdependence of new financial products

[16:38]  Boston Hutchinson: That may have been a factor in Long Term Capital's collapse

[16:38]  You: (yes, A, except with something like index investing, and in those constant changes, there are business opportunities)

[16:39]  You: Yes, Boston, - I 'm not familiar with the details there).

[16:39]  You: So beyond stocks and bonds and currency

[16:39]  You: new financial products include SECURITIZATION

[16:40]  You: in effect, anything can become a financial Asset

[16:40]  You: So, for example, you can sell the future

[16:40]  You: You can sell the fact that in 10 years you will be able to buy wheat at such and such a price

[16:41]  You: And you can sell the future - IN ADVANCE

[16:41]  You: so you can sell the option

[16:41]  You: to buy at such a price or a different price

[16:41]  You: For example,

[16:41]  You: 1) I buy your wheat at $10/ton in 5 years - I have to buy

[16:42]  You: B If you want to get out of the deal, Someone else buys the option of buying or not buying

[16:42]  You: C) And other people have the option of buying or not buying someone else's options

[16:43]  You: With all of this, you have SWAPS - so much copper for so much wheat or Microsoft stock for Intel stock

[16:43]  You: And then there are DERIVATIVES

[16:43]  You: which are the most complex

[16:43]  Boston Hutchinson: Futures contracts usually settle for cash--in fact, I think you may be required to make daily adjustments of cash if the price moves against you

[16:43]  You: They are synthetic securities

[16:44]  You: Yes

[16:44]  You: Futures in derivatives are very complex

[16:44]  You: They are synthetic securites

[16:44]  Boston Hutchinson: swaps are usually interest rates--fixed vs. float is the most common

[16:44]  You: which combine different effects

[16:44]  You: Yes

[16:45]  You: A typical derivative of stocks and bonds and currencies, etc. makes an animal :)

[16:45]  You: For example, you might have

[16:45]  You: stock - google

[16:45]  You: Bond - New York City

[16:45]  You: Currency - Hong Kong

[16:46]  You: and Raw material - the price of rubber in Indonesia

[16:46]  You: The value of the derivative is the result of all the components

[16:46]  You: And mutal funds are one form of derivatives

[16:46]  You: The value depends on the vlaue of different components

[16:46]  You: Why are these so important?

[16:47]  You: 1) Derivatives are immediately traded at a much higher price than the value of each component.

[16:47]  You: They therefore offer an extraordinary increase in value

[16:48]  You: In 1997 the world market for derivatives was 360 trillion dollars, 12 x the world's GDP

[16:48]  You: You can make much more money without waiting

[16:48]  You: So derivatives expand the mass of money

[16:48]  You: Derivatives are also important in terms of Globalization -

[16:49]  You: all can be diversified from different countries

[16:49]  You: Derivatives allow traders to intergrate many different assets

[16:49]  You: And derivatives interconnect markets, independent of flows of capital between markets

[16:50]  You: And they are instruments of financial contagion

[16:50]  You: 4)

[16:50]  You: The 4 th mechanism of integration of financial markets

[16:50]  You: is the sudden movement of financial flows

[16:50]  You: when you have capital in one currency

[16:51]  You: By moving dramatically, the ruble in Russia, by 1992, collapsed.

[16:51]  You: This money went to the US

[16:51]  You: and increased the value of the dollar $

[16:51]  You: and it impacted other currencies

[16:52]  You: And 4 months later, Brazil lost money

[16:52]  You: because otehr investors thought "emerging" markets unsafe

[16:52]  You: There are two major sources of validation in Global Financial markets

[16:52]  You: One is Moodys and the other Standard and Poors

[16:53]  You: They assess VALUE

[16:53]  You: and rank in principle

[16:53]  You: They have a standard model of investments

[16:53]  You: If the model thinks the investor may lose money they down rank an asset

[16:54]  You: What triggered the Korean collapse in the ealry 1990s was a devaluation of financial capital in world markets - nothing to do with Moodys or S & Ps)

[16:55]  You: Why are Standard and Poors and Moodys so significant in this new world financial interdepence?

[16:55]  You: Because all financial marekts in the world have to fit into this model.

[16:56]  You: And capital investment that doesn't follow what these specialized companies think, arent well ranked

[16:56]  You: So to be part of the global economy

[16:56]  You: there are rules

[16:57]  You: If you don't accept the rules, global capital investment doesn't come to you.

[16:57]  You: Money will come to you if you fit into criteria

[16:57]  You: Countries can be very different, but mechanisms are not.

[16:58]  You: 30 years ago, Mexico and Brazil could stipulate when they would devalue their own currency, or not devalue their own currency

[16:58]  You: Now Mexico follows the U.S.

[16:58]  You: So homogenization in each group is key

[16:59]  You: and there's movement toward not have capital in companies which don't meet this criteria, stipulated by the companies - Moodys and Standard and Poors

[17:00]  You: So homogenization occurs also in rules of invesment - with partial exceptions

[17:00]  You: the most important being china

[17:00]  You: Do you have any questions, thoughts, ideas, before we take a 7 minute break??

[17:01]  You: So let's take a break, and talk about some of these things when we get back.

[17:01]  Boston Hutchinson: I think Moody's and S&P cover mostly debt, so they don't have so much effect on compnies with no debt.

[17:01]  You: But I see you both typing

[17:02]  You: True, Boston

[17:02]  You: But most companies have some debt

[17:02]  Andromeda Mesmer: Q later

[17:02]  Rain Ninetails: are currencies and markets ranked , lor just companies?

[17:03]  Rain Ninetails: making the need to be similar, I mean?

[17:03]  Boston Hutchinson: Also, on derivatives, they serve primarily to increase the efficiency of capital, by allowing companies to invest in and focus on what they are good at, hedging their cash flows and translating currencies and locking in interest rates.

[17:03]  You: Currencies and markets are valued, as far as I know, but it's a very complex process, and I don't think any one specific company does so.

[17:04]  Rain Ninetails: hm

[17:04]  You: Yes, they can be very helpful to companies.

[17:05]  You: So let's come back in 7 minutes, and we can talk more - it looks like you have some more thoughts, Rain - see you soon.

[17:05]  Andromeda Mesmer: ok

[17:05]  Rain Ninetails: I am going to re-log.

[17:05]  Boston Hutchinson: ok

[17:05]  You: ok

[17:05]  Rain Ninetails: whish me luck :)

[17:05]  You: :)

[17:05]  Boston Hutchinson: Good luck rain!

[17:05]  Andromeda Mesmer: heh .

[17:10]  Andromeda Mesmer: I hope Rain can come back here -- I had an awful time -- at one point, I was sent to the wrong place -- via the LM for this location.

[17:11]  Diego Ibanez is Offline

[17:11]  Andromeda Mesmer: Geda can't make it at all -- I sent her TP's which did not work.

[17:11]  Boston Hutchinson: I guess I was just lucky today, I didn't have any problems.

[17:11]  Andromeda Mesmer: She can't get to berkman Sandbox either -- if she could do that, she could fly here.

[17:12]  Boston Hutchinson: Hi Rain. Glad you got back here!

[17:12]  Andromeda Mesmer: Hi Rain -- look like some textures missing, but non the worse for wear!

[17:12]  Enapa Pennell is Online

[17:12]  Rain Ninetails: I had to try six times!

[17:13]  Andromeda Mesmer: I'm not surprised at all.

[17:13]  Rain Ninetails: it said the Inventory Systems was, um, not.

[17:13]  Rain Ninetails: no?

[17:13]  Rain Ninetails: what is going on?

[17:13]  Andromeda Mesmer: yesterday, when I tried to give out my usual help folder to a newbie, it said I had no authority to do so!

[17:13]  Andromeda Mesmer: So -- all I could do was talk to the guy.

[17:13]  Boston Hutchinson: I don't have much inventory. I wonder if that's a factor in not encountereing the bugs?

[17:13]  You: Hello Enapa!

[17:14]  Enapa Pennell: Hello, Aphilo; All

[17:14]  Boston Hutchinson: Hi Enapa

[17:14]  Rain Ninetails: maybe.

[17:14]  Andromeda Mesmer: Good evening Enapa :)

[17:14]  Enapa Pennell: hi, Andromeda

[17:14]  Andromeda Mesmer: You look all nice and gray to me -- server problem I guess.

[17:15]  You: More reliability would make this a more dependable business environment

[17:15]  Rain Ninetails: and they have like, given up on availabilty, and now published a palnned outages calendar

[17:15]  Andromeda Mesmer: Righto, Aphilo.

[17:15]  You: Yes . . .

[17:16]  You: Does anyone here no of interesting objective overview of SL, from a kind of sociological point of view?

[17:16]  Andromeda Mesmer: One SL business owner (a Dutch IT guy) said he has lost 10,000's of L$ from SL glitches.

[17:16]  Enapa Pennell: This environment make very intensive use of clustering and interprocess communications, its hard.

[17:16]  You: What's happening economically, socially, technologically . . . perhaps Ted Castronova's recent talk goes into some of this.

[17:17]  Andromeda Mesmer: Well, there is the psychological aspect -- that people who stick around are very very determined, and willing to learn and to re-learn, and to adjust to problems.

[17:17]  Andromeda Mesmer: Or put up with problems - patient.

[17:18]  Andromeda Mesmer: These people -- the survivors -- the 10% of all who try out SL -- they form social and other networks.

[17:18]  You: Yes, Enapa, but the web and apps are constructed around convergence.

[17:18]  Andromeda Mesmer: So what is here is not at all reflective of the real world.

[17:18]  Enapa Pennell: It is a frontier mentality. Many here feel it is a new type of place, and thus the snags and glitches are accepted.

[17:18]  Andromeda Mesmer: True Enapa.

[17:19]  You: Ted Castronova gave a talk recently in-world, which should be availabe here: http://slcn.tv/

[17:19]  Andromeda Mesmer: But also -- you have to be willing to accept embarassing situations.

[17:19]  Sarasvati Kohime is Offline

[17:19]  You: He has studied and characterized virtual world economies

[17:19]  Enapa Pennell: I've been a practicing "converger" for more than a decade, its hard, even when you have some control of the environment.

[17:20]  You: in this book: http://www.amazon.com/Synthetic-Worlds-Business-Culture-Online/dp/0226096262

[17:20]  Sarasvati Kohime is Online

[17:20]  You: Yes, it's very frustrating, but in some ways SL is as a good as it gets, and there are more folks here than anywhere else

[17:21]  You: So, Rain - do you have some thoughts or questions?

[17:21]  Andromeda Mesmer: No idea how many there are in the Chinese Hipihi so far, Aphilo?

[17:21]  You: I don't . . . I'm looking for data sources, too.

[17:22]  Rain Ninetails: no, but I am listening, back here

[17:22]  You: But let's return to Financial markets and China

[17:22]  You: So China has 2 systems, one of which is not entirely glboal

[17:22]  You: They haven't converted all parts of their economy

[17:22]  You: There are globalized sectors

[17:23]  You: And through government control, they have transformed these parts of the economy into convertible assets

[17:23]  You: This sector employs only a little more than 20%, but generates around 80% of Chinca's GDP

[17:24]  You: Vis-a-vis the globalized segment of the Chinese economy, the government is betting on the ability to transform

[17:24]  You: the non globalized segments - and many people think it won't work

[17:25]  You: But it's hard to maintain 2 economies and 1 country.

[17:25]  Andromeda Mesmer: What parts are non-globalized?

[17:25]  You: HOW FINANCIAL MARKETS FUNCTION

[17:25]  Enapa Pennell: are there separate currencies, or both in yuan

[17:25]  You: What is valued and how things are valued determines the fate of the market

[17:25]  You: (No, one currency only).

[17:26]  You: So companies which are publicly traded companies are owned by shareholders

[17:26]  You: Shareholders put money into copanies with the hope that stocks will make money

[17:27]  You: How financial markets value a company is essential for countries, too

[17:27]  You: The value of everything is determined by the valuation in financial markets

[17:27]  Bruce Flyer is Online

[17:27]  You: This is fundametnally about profits.

[17:27]  You: If you have profits, this goes into stocks.

[17:28]  You: No profits and you lose money

[17:28]  Bruce Flyer is Offline

[17:28]  You: Historically, stock dividendes were paid out quarterly

[17:28]  You: And this was the general practice until about 25 years ago.

[17:28]  You: Now less than 1/4 of American copanies pay dividends

[17:28]  Bruce Flyer is Online

[17:29]  You: The idea here is that you have profits which need to be invested, rather than paid out

[17:29]  You: So this increases the value of stock

[17:29]  Bruce Flyer is Offline

[17:30]  You: So, the economy has shifted from profits as a source of making money, to frowth of stocks as a way to make money.

[17:30]  Bruce Flyer is Online

[17:30]  Bruce Flyer is Offline

[17:30]  You: And earning are the most important matte r- because they indicate how valuable a compnay is

[17:31]  You: What is now improtant to shareholders is increase in the value of shares

[17:31]  You: Recently, the gap between earnings and the value of shares has grown.

[17:31]  You: Why?

[17:32]  You: In global interdependency, the way value is assigned depends on investors' expectations

[17:33]  Enapa Pennell is Offline

[17:33]  You: If you think an aspect of the Internet is going to be big in 5 years . . that will make the value of a company go up

[17:33]  You: And these expectaitons are shaped by information

[17:34]  You: So, what happens is - information permeates form multiple origitns via the Internet

[17:34]  You: and this affects prices.

[17:34]  You: And RUMOR does destroy price

[17:34]  You: This mechanism is central !

[17:34]  Enapa Pennell is Online

[17:34]  You: in a HIGH TECH / HIGH VALUE ECONOMY

[17:34]  You: linked to a global Netowkr

[17:35]  You: not everyone works for a global master

[17:35]  Enapa Pennell: (lost power, electrical storm)

[17:35]  You: The toral labor force in the world is 3 billion - and half of this is in agriculture

[17:35]  You: (it's raining in PA, as well - but no electrical activity).

[17:36]  Bruce Flyer is Online

[17:36]  You: And nontradable services - e.g. sweeping for a municipality, e.g. health care

[17:36]  You: aren't tradable

[17:36]  Andromeda Mesmer: Raining in Toronto as well.

[17:36]  Bruce Flyer is Offline

[17:36]  You: (ah, winter) But people

[17:37]  You: But people's work in the informal economy is linked, as well.

[17:37]  You: Through companies . . .

[17:38]  You: For example, everyone depends on G.E. - for electricity generation machinery, and multiple other htings

[17:38]  You: but most people and activities aren't in G.E. (General Electric).

[17:38]  You: The fact that these glboal networks are so flexible and dynamic is due to information technology

[17:38]  Sarasvati Kohime is Offline

[17:38]  You: and means that everybody who works for a company ends up being connected into a netowrk

[17:39]  Sarasvati Kohime is Online

[17:39]  You: Everything is now related in the world economy.

[17:40]  You: Say the world moves to fiber optic and away from copper, and Chile goes belly up, because it's connected and dependent on copper, for example.

[17:40]  Boston Hutchinson: Hi Geda

[17:40]  Enapa Pennell hello Geda

[17:40]  Geda Hax: Hi

[17:40]  Geda Hax: all

[17:41]  You: Or say Bangalore which started as an Indian defense electronics producer, becomes largely obsolete

[17:41]  Geda Hax: Geez what an awful sl day

[17:41]  You: and this happened - but their government joined with the Indian Institute of Technology, which produces excellent engineers and scientists

[17:41]  You: were discovered

[17:42]  You: by the U.S. and Silicon Valley - and they could then work online . . .

[17:42]  You: Through this process, Banglaore became directly connected to a global netwrok of accumulation and technology

[17:42]  You: (Hi Geda)

[17:42]  Geda Hax: (Hi Ap)

[17:43]  You: IN India, there are about 1 billion people

[17:43]  You: How many had an Internet connection around 2000?

[17:43]  You: app. 2 million.

[17:43]  You: And china has 1.3 billion people

[17:43]  You: and in around 2000 they had 14 million connected

[17:44]  Bruce Flyer is Online

[17:44]  You: In India, in 1997, only 300,000 people were connected

[17:44]  Bruce Flyer is Offline

[17:45]  You: What's signficant is that geogprahy of regions is becoming much less important, economically, and networks are becoming much essential.

[17:45]  You: Within a network - there's an expanding dynamic world / global economy with problems

[17:46]  You: And this new economy is based on Knowledge > and related management issues - and has a global structure

[17:46]  You: Out of a netwrok, you are nowhere.

[17:46]  You: And this is NEW

[17:47]  You: So the structure of networks which are flexible, scan the planet, and decide whether to incorporate regions or not.

[17:47]  You: The process of glboalization has a differential impact on wealth and poverty.

[17:47]  You: And it has made dramatic in roads.

[17:47]  You: Hong Knog and Singapore have a higher per capta income - 10% higher - that the average in the European Union

[17:48]  You: And Korean ruled areas bring down the average, but so do coutnries like Portugal

[17:48]  You: And globalization has helped areas in SE Asia

[17:49]  Patrio Graysmark is Online

[17:49]  You: Thailand in the Bangkok area was seeing 12% growth at the trun of the millenium

[17:49]  You: So the processes of growth and development have improved standradsof coutnries.

[17:50]  You: But within countries, there are termendous disparities

[17:50]  You: There are major areas which are connected

[17:50]  You: And there's a disparity of connection, which realtes to distance, where unconnected areas are both undynamic and non competitive

[17:51]  You: And some countries are entirely disconnected - sub Saharan Africa, for example - where only a very tiny elite have access to the Intenret

[17:52]  You: And governments are caught into competition

[17:52]  You: So, to close,

[17:52]  You: Globalization has increased wealth dramatically

[17:52]  You: and left out entire regions

[17:53]  You: And in those regions where Globalization has hynamized a country, living standards have improved.

[17:54]  You: And Globalization integrates people who are part of a professional elite - i.e. those who aren't exploited

[17:54]  You: So the old geogprahy of a kind of core - semi periphery - core is now

[17:55]  You: newly shaped into NETWORKS which connect the bits and pieces

[17:55]  You: There is no more core periphery core - relating to an old geometry of inclusion - exclusion

[17:56]  You: Globalization now amplifies countries systems

[17:56]  You: And it also increases volatility

[17:56]  You: If an economy depends on investments

[17:57]  You: e.g. Indonesia where 50% of its assets evaporated, and Korea was destroyed in the 1990s

[17:57]  You: it can also turnaround an economy - e.g. Russia

[17:57]  You: Economies recover from hits but much mroe slowly.

[17:57]  You: So, next time we'll look at how Globalization has really changed the world

[17:58]  You: Thoughts and questions?

[17:58]  Enapa Pennell: I have always felt that the capitol flight from Indonisia was a concerted effort to de fang the Asian Tiger.

[17:59]  You: It was more a process related to valuation in a global market

[17:59]  Enapa Pennell: The Chinese watched that happen. Their unwillingness to play ball in capitol markets, I believe, is directly related

[17:59]  Andromeda Mesmer: malaysia isolated itself from the global transfer of currencies in order to stop volatility, and actually managed quite well.

[17:59]  You: Yes, but Malaysia is also closely connected with Singapore

[17:59]  Andromeda Mesmer: I agree, Enapa -- the chinese are very cautious now --

[18:00]  Enapa Pennell: So, these contries do want to be players in this global economy, but causious ones.

[18:00]  You: Yes, China is also the 800 pound gorilla, so to speak, with very rapid growth, and lots of growing environmental costs, potential labor movements, an d

[18:01]  Enapa Pennell: Singapore, and Lee, are definite players

[18:01]  You: in a libralized world economy, it's very difficult for a system that moving toward capitalism, without much history with it, and which is authrotarian to manage - but its labor poolsa re huge and very inexpensive.

[18:02]  You: Yes . .

[18:02]  You: Well, I need to move from where I am now . . . so I'll see you next week . . .

[18:02]  Enapa Pennell: But, as you pointed out, China is willing to give up some environmental concerns to accellarate growth.

[18:02]  Geda Hax: problem with these kind of investiment is what is the real meaning of it ...there are investors that only put money targeting quick and high returns and at any sign of local problems they take the money back ....thats why its so volatil ( risky but very profitable)

[18:03]  You: And pay those costs down the road, - and they will be significant.

[18:03]  You: And their turnover of capital can make others very rich - caveat emptor - buyer beware

[18:04]  Enapa Pennell: Thank you, Aphilo. Very good presentation and synopsis

[18:04]  Andromeda Mesmer: Agreed.

[18:04]  Boston Hutchinson: Yes, thanks, Aphilo.

[18:04]  You: Thanks ! So, good night - if you have a facebook page - I am making some announcements there, relating to this class

[18:05]  You: You can search on Scott MacLeod in the Reed College network - I'm playing the bagpipe in my picture ( no kids)

[18:05]  Geda Hax: Thank you Ap and and sorry for getting here so late today,

[18:05]  You: Add friends - and you'll see the announcements

[18:05]  You: Glad you came Geda.

[18:06]  You: So, see you next week.

[18:06]  Geda Hax: OK , see you .

[18:06]  Rain Ninetails: bye

[18:06]  You: until then :)

[18:06]  Boston Hutchinson: Bye all.

[18:06]  Andromeda Mesmer: Bye everybody.

[18:06]  Boston Hutchinson: I hope SL is working better next time!

[18:07]  Rain Ninetails: yes. it has been a terrible day for that.

[18:07]  Geda Hax: Bye

[18:07]  Boston Hutchinson is Offline

 

 

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