How to Build a Consumer Society in Five million words or less

Take the time to read this behemoth out of the NYT magazine. Its an interesting (albeit anecdotal) perspective on trying to transform China from an industrial to a consumer-driven society. An interesting observation that this is where several economies have gotten stuck before (Japan, Russia).

via Ritholtz

History of World GDP

In the effort of always keeping things in historical context, let's zoom way out:

Interesting perspective (I stole this from The Big Picture) on how China and India are simply mean reverting to their traditional contributions to world GDP. Ritholtz rightly points out that this is a function of population size first and that the industrial and technological revolutions catapulted the US forward (an advantage that will inevitably be dispersed in the coming years).

Links!

WSJ: Ten Reasons to be Cautious

iBankCoin: The Michael Phelps Econ Conundrum (i.e. Inflation or Deflation: DEFLATION)

WSJ: China will probably be named world's second largest economy after 2010 (beating out Japan)

Bloomberg: 'The expendables' demolished 'Eat, Pray, Love' at the box office. Guns > butter tea

Bloomberg: Gold goes up forever (GGUF)

Two articles: Gold and Equity valuations

First interesting article is from The WSJ regarding China's decision to remove some restrictions in Chinese bank gold trading. Upon hearing this news, gold has been up about $10/ounce in less than 24 hours. We'll see if this adds to China's long term importation demand for the yellow metal.

Second link is from the Big Picture. We have once again hit the 50% retracement level in the S&P 500. Stocks (once again) are not inherently cheap. Ritholtz draws the conclusion : "That does not mean we cannot grind upwards from here; it just means that its going to take a lot of something — good earnings, liquidity, sentiment, breadth, momentum, psychology, quantitative easing, something – to move higher from here"

I would have to agree.