Index
A
adjustable-rate mortgages (ARMs), 29–31, 53–54
agribusiness, 161–163
Brazil, 152–160
agriculture
arable land
Brazil, 152
China, 147–148
farm equipment market, 162
production and consumption, China, 147–151
water, China, 148–151
AIGFP (AIG Financial Products), 64
Alt-A mortgages, 29
alternative energy, 191–192, 195
carbon sequestration, 197
coal, 196
GTL (gas to liquid), 198
natural gas, 198
syngas, 194
American Recovery and Reinvestment Act of 2009, 76
Americas, water, 148
animal spirits, 84
aquaculture, 210–215
arable land
Brazil, 152
China, 147–148
Argentina, tractors, 162
ARMs (adjustable-rate mortgages), 29–31, 53–54
Asia
educational services companies, 237–238
fish consumption, 207
oil demand, 166
Asian tiger model, 119
asset-backed securities, 22
automobiles
in China and India, 171
fuel efficiency standards, 247
hybrids, 246
average gasoline price survey, 178
B
bailouts, people’s confidence in, 75
Bank of America, 98
Lehman Brothers, 63
Merrill Lynch, 65
banks, U.S. government and, 97
Barclays, 63
bargain hunters, 2
barrel of oil equivalent (BOE), 179
bear markets, 77
Bear Stearns, 36–39
Enhanced Fund, 36–39
fall of, 58–60
High Grade Structured Credit Fund, 36–39
Brazil, 154
China’s consumption of, 143–146
bitumen, 193
Blankfein, Lloyd, 45
BOE (barrel of oil equivalent), debt, 179
Brands, China, 134
Brazil, 111–113
agribusiness, 152–160
arable land, 152
corn, 157
feed grain, 159
fertilizer application, 160
grains, 156
International Monetary Fund (IMF), 112
poultry exports, 153
tractors, 162
breaking the buck, 66
Bretton Woods system, 182
budgets of regulatory agencies, 95
BYD (Build Your Dreams), 254
C
CAFE (Corporate Average Fuel Economy), 247
Canada, oil sands, 192–193
cap-and-trade policies, alternative energy, 197
capitalism, 102
China and, 119
carbon sequestration, 196–197
cars in China and India, 171
Case-Shiller home price index, 49
Cayne, James, 58
CDOs (collateralized debt obligations), 27, 36, 48, 57
CDS (credit default swap), 64
cell phones
China, 136
penetration rates, 242
CFL (compact fluorescent light), 248
changing landscape, 114
character, credit, 19
Chile, aquaculture, 213–215
China, 119
agriculture, production and consumption, 147–151
arable land, 147–148
automobiles, 171
beef and poultry consumption, 143–146
brands, 134
capitalism, 119
cell phones, 136
cities, growth of, 131
commodities, 126
construction, 126
consumerism, 128–134
domestic economy, 128–134
earthquakes, 120
education, 219–220
English language training, 225
Gaokao test, 226
higher education, 227–229
online courses, 223–224
spending on, 220–223
tutoring, 225
entrepreneurialism, 105–109
financial crisis of 2008 and 2009, 117
fish consumption, 206
floods, 120
GDP since 1980, 142
generational divides, 129–131
growth, 103
innovation, 108
insurance industry, 129
natural resources, 122–123
online shopping, 136
products, popular, 135–139
professional testing, 228
rare earths, 249–255
savings, 119–122
second-tier cities, 131
taste preferences, 132–134
technology, 136
third-tier cities, 131
Treasury holdings, 91
urbanization, 126–128
water, 148–151
women in the workforce, 145
China’s sorrow, 120
Cioffi, Ralph, 37
cities in China, growth of, 131
Citigroup, 98
coal, 196
coal-to-liquids market, 197
collateralized debt obligations (CDOs), 27
college endowments, Western institutions, 230–231
commercial paper, 74
Commercial Paper Funding Facility (CPFF), 74
commodities
China, 126
future prices, 165
oil. See oil
common owned versus privately owned, 201–202
Community Reinvestment Act of 1977, 21
compact fluorescent light (CFL), 248
compensation expenses, 45
competition, 101–105. See also entrepreneurialism, 105–109
confidence, velocity, 85
Confucian doctrine, 219
Confucian principle, 117
construction, China, 126
consumer credit, 24
Consumer Price Index (CPI), 12
consumer spending, GDP 2003, 10
consumerism, China, 128–134
consumers, 88
corn, Brazil, 157
corn consumption, 158
Corporate Average Fuel Economy (CAFE), 247
Countrywide Financial, 55
CPFF (Commercial Paper Funding Facility), 74
CPI (Consumer Price Index), 12, 182
Cramer, Jim, 62
CRB commodity index, 123
consumer credit, 24
home equity line of credit, 14
stop of, 67
credit bubble, 46–50
credit default swap (CDS), 64
credit rating agencies, 41
currency, debasement of, 82
D
debasement of currency, 82
debt. See also household debt, 8, 17, 49, 68
per BOE (barrel of oil equivalent), 179
U.S. government, 90–92
financing, 86
debtor nations, 114
defaults, subprime mortgages, 55–57
deflation, 72
quantitative easing, 80
deleveraging, 67
delinquency rates, 28
demand
overexploitation, oceans, 206–209
for rare earths, 252–255
demand for technology, 242–244
developing countries, fish consumption, 207
diadromous fish, 211
Dimon, James, 59
domestic economy, China 128–134
E
earthquakes, China, 120
economic recovery, built on borrowed money (2003), 8–13
economy, world economy, 67
education, 217
China, 219–220
English language training, 225
Gaokao test, 226
higher education, 227–229
tutoring, 225
emerging markets, 218–219
household spending on, 220–223
higher education, financial crisis portends continued growth in emerging, 230–234
online courses, 223–224
students, financial issues, 233
technology and, 223–224
education services industry, stocks, 234–236
educational services companies, emerging markets and Asia, 237–238
Emergency Economic Stabilization Act, 73
emerging markets, 217
education, spending on, 220–223
educational services companies, 237–238
financial crisis protends continued growth, 230–234
higher education, 218–219
Emmanuel, Rahm, 76
endowments, Western institutions, 230–231
Energy Independence and Security Act of 2007, 157
English language training, China, 225
Enhanced Fund, 36–39
entrepreneurialism, 105–109
equation of exchange, 85
equity risk premium, 85
erbium, 242
ethanol consumption, 157
europium, 241
exploitation, oceans, 204–205
exploration and production (E&P), oil, 172–174, 178
F
Fannie Mae, 21
subprime mortgages, 61
farm equipment, 162
farmers, U.S., 163
fat tailed, 64
FDIC (Federal Deposit Insurance Corporation), 45
Federal Housing Enterprises Financial Safety and Soundness Act of 1992, 21
Federal Register, 93–94
Federal Reserve
chairman of, 83
quantitative easing, 89
timing markets, 13
feed grain, Brazil, 159
feed grain multiplier, 155
fertilizer application, Brazil, 160
“Financial Chaos,” 50–52
financial crisis, continued growth in emerging market education services, 230–234
financial crisis of 2008 and 2009, China, 117
financing debt, U.S. government, 86
First Pacific Advisors, 41
Fischer, Franz, 194
Fischer-Tropsch process, 195
fish consumption, 206
Asia, 207
China, 206
developing countries, 207
U.S., 208
fisheries, 203–205
aquaculture, 210–215
salmon, 212
fishers, 209
Fitch, 41
flipping homes, 18–19
floods, China, 120
Florida State University, 232
foreclosure crisis (2008), 60
Frank, Barney, 98
Free to Choose, 95
fuel efficiency standards, automobiles, 247
G
Gaokao test, 226
Garn–St. Germain Depository Institution Act, 47
gas to liquids (GTL), 198
gasoline, average price survey, 178
GDP (Gross Domestic Product)
compared to protein consumption, 144
growth (2003), 8
per head since 1980, China and India, 142
General Motors (GM), 245
Hummers, 16–17
U.S. government’s rescue of, 97
generational divides, China, 129–131
Getty, Paul, 165
Global Competitiveness Index, 103–111
global economies, changing landscape of, 114
Global Purchasing Priorities Survey, 221
GM. See General Motors
Goldilocks economy, 13–14
Goldman Sachs, 37
government regulation, 93–98
government take over of Fannie Mae and Freddie Mac, 61
grain prices, relationship to oil prices, 161–162
grains, Brazil, 156
Great Britain, 92
Great Depression, household debt, 49
green economies, rare earths, 245–249
Greenspan, Alan, 24
inflation, 86
Greenwich Associates, 24
growth
of cities in China, 131
GDP 2003, 8
government regulation, 94–98
in monetary base of U.S., 80
of prosperity China and India, 142
regulation, 93
GTL (gas to liquid), 198–199
H
Hardin, Garrett, 201
hedge funds, 23–24
Enhanced Fund, 36–39
High Grade Structured Credit Fund, 36–39
High Grade Structured Credit Fund, 36–39
higher education
emerging markets, 218–219
financial crisis portends continued growth in emerging market, 230–234
home equity line of credit, 14
home price index, 12
home prices, 11–12
median house price versus median income, 39
home values, 11
homes, flipping, 18–19
divided by household net worth, 68
household net worth, divided by household debt, 68
household spending on education in emerging markets, 220–223
houses, vacant homes, 53
human behavior, 201–203
oceans, 203–205
overexploitation, 206–209
Hummer, 16–17
hybrid vehicles, 246
hydrocarbons, 192
hyperinflation, Brazil, 111
I
IFRS (International Financial Reporting Standard), 229
ILCs (Industrial Loan Companies), 47
in-situ process, oil sands, 193
India
automobiles, 171
education, spending on, 221
GDP since 1980, 142
Industrial Loan Companies (ILCs), 47
IndyMac Corp., 60
Infectious Salmon Anemia (ISA), 214
Inflation, 81–86
Brazil, 111
risk, 3
initial public offering (IPO), 36
innovation, China, 108
insurance industry, China, 129
interest-only loans, 29
International Financial Reporting Standard (IFRS), 229
International Monetary Fund (IMF), Brazil, 112
Internet, China, 130
Internet usage, China, 223
IPO (initial public offering) 36
ISA (Infectious Salmon Anemia), 214
J
J.P. Morgan, 59
Washington Mutual, 66
Jintao, President Hu, 127
June 25, 2003, 7
K
Keju, 219
Keynes, John Maynard, 84
Korea Development Bank, 62
L
LCD panels, 243
fall of, 62–64
lending money, criteria for, 19
Lewis, Ken, 65
liar loans, 30
LIBOR (London InterBank Offered Rate), 29
Lifton, Jack, 248
light bulbs, 248
Little Emperors, China, 129
Lloyd, William Forster, 201
loans, real estate loans as percentage of total loans, 46
London InterBank Offered Rate (LIBOR), 29
Lynas Corp. of Australia, 251
M
Mack, John, 45
Madoff, Bernie, 93
market distortions, oil, 179–184, 191
McMahon, Ed, 61
McMansions, 16
Me Generation, China, 130
measures of volatility, 65
Middle East, oil consumption, 167
miniaturization, rare earths, 242
Molycorp, 250
monetary base of U.S., growth of, 80
monetary expansion, 80–84
money, lending (criteria for), 19
money market funds, 66
Money Mischief, 85
money policy, oil, 183
Moody’s, 41
Morgan, J. Pierpont, 19
mortgage-backed securities, 22
mortgages
Alt-A, 29
delinquency rates, 28
subprime, 26–33
U.S. chartered commercial banks’ total mortgages, 45
Mount Weld project, 251
Mountain Pass, California, 250
N
The National Bureau of Economic Research, 76
nationally held oil companies versus privately held, 174, 178
natural disasters, China, 120–121
natural gas, 198
natural resources, China, 122–123
negative amortization loans, 30
net worth of U.S. households, 15
New Zealand, quotas for fishers, 209
Norway, salmon fishing, 214
O
O’Neal, Stanley, 65
Obama, President Barack, 68
oceans
human behavior, 203–205
overexploitation, demand, 206–209
OECD (Organization for Economic Cooperation and Development), 17
breakeven costs measured in oil prices per barrel by source of supply, 199
exploration and production, 172–174, 178
future prices, 165
market distortions, 179–184, 191
money policy, 183
reserve growth, 184
reserve replacement, 184
supply and demand, 166–169
oil consumption, relation to prosperity, 170–172
oil prices, relationship to grain prices, 161–162
oil sands, 194
Canada, 192–193
online education, 223–224
online shopping, China, 136
Organization for Economic Cooperation and Development (OECD), 17
overexploitation
fisheries, 204–205
oceans, demand, 206–209
P
packaging home loans, 20
Pandit, Vikram, 98
penetration rates
cell phones, 242
LCD panels, 243
petrocommodities, 161
Pickard, Lee, 43
Poole, William, 63
poultry, China’s consumption of, 143–146
poultry exports, Brazil, 153
printing money, 80–82
privately held oil companies versus nationally held, 174, 178
privately owned versus common owned, 201–202
productivity, U.S., 102
products, popular in China, 135–139
professional testing, China, 228
prosperity
growth of, 142
relationship to oil consumption, 170–172
protein consumption
China 143–146
compared to GDP, 144
public versus private resources, 201
Q
quotas for fishers, 209
R
rare earths, 241–242
China, 249–255
demand for, 252–255
green economies, 245–249
neodymium, 253
real estate, flipping homes, 18–19
regulation, 93–98
regulators, SEC, 93
regulatory agencies, budgets, 95
reserve currency, 82
reserve growth, 184
reserve replacement, oil, 184
revenues, Lehman Brothers, 45
risk, inflation, 3
risk aversion, 85
Rodriguez, Robert, 41
S
salmon, 212–213
Norway, 214
Saturday Night Live, 117
savings, China, 119–122
savings rates, 8
Schumer, Charles, 98
Schwartz, Alan, 58
Schwarzenegger, Arnold, 16
SEC (Securities and Exchange Commission), 43
Madoff, Bernie, 93
second-tier cities, China, 131
securities, 21
asset-backed, 22
mortgaged-backed, 22
securitization market, 20
shadow banking system, 74
Shell, 198
Shiller, Robert, 11
Singapore, 118
Singaporean model, 118
small business, regulation, 96
smartphones, 243
soybean oilseeds, 147
Brazil, 154
spending on education in emerging markets, 220–223
U.S. government, 86–89
spendulus package, 77
Standard and Poor’s 1500 Education Services Subgroup Index, 235
stimulus package, 77
stock market valuations, 78
fourth quarter 2008, 77
stocks, education services industry, 234–236
students, financial issues, 233
subprime mortgages, 26–33
defaults, 55–57
supply and demand, oil, 166–169
surveys, average gasoline price, 178
syngas, 194
synthetic fuel, 195
T
TALF (Term Asset-Backed Securities Loan Facility), 74
TaoBao, 136
TARP (Troubled Asset Relief Program), 73
taste preferences, China, 132–134
technology, 255
China, 136
demand for, 242–244
education and, 223–224
education stocks, 236
Term Asset-Backed Securities Loan Facility (TALF), 74
Thain, John, 65
third-tier cities, China, 131
thrift certificates, 47
Toyota, hybrids, 247
Toyota Prius, 245–246
tractors, 162
Treasuries, 89
Treasury bonds, 86
Treasury holdings, China, 91
Tropsch, Hans, 194
Troubled Asset Relief Program (TARP), 73
trust, break down in, 72
tutoring, China, 225
U
U.S.
education, 218
spending on, 221
farmers, 163
fish consumption, 208
meat consumption, 143
productivity, 102
renewable fuels, 157
U.S. consumers, 88
U.S. dollar, 3
U.S. federal budget deficits, 87–89
U.S. government
banks and, 97
debt, 90–92
financing, 86
rescue of GM, 97
spending, 86–89
urbanization, China, 126–128
utility-scale wind turbines, 247
V
vacant homes, 53
value investors, 2
velocity, confidence, 85
volatility index (VIX), 65
W
Wachovia, 66
Washington Mutual, 66
water, China, 148–151
wealth, 15
Wells Fargo, Wachovia, 67
Western big oil, 174
Western consumer goods, Chinese opinion of, 133–134
Western schools, financial crisis, 230
women in the workforce, China, 145
world economy, 67
X
Xiaoping, Deng, 103, 117–118, 241
Y-Z
Yale, loss of endowments, 232
Yangtze River, China, 120
Yellow River, China, 121
Yew, Lee Kuan, 118