After almost two decades of successful development, Vietnam's economy is being ravaged by inflation and macroeconomic instability as never before. How did this happen and what remedies are available to deal with it?

The country's successes are well documented. Vietnam's sizzling growth over the past 15 years has brought its poverty rate down from 58% in 1993 to around 15% last year. Thanks to political stability and prudent macroeconomic management, it has also managed to lure foreign investors. Foreign direct investment (FDI) approvals have increased impressively, reaching US$20.3 billion last year.

However, the recent surge in inflation to double-digit levels could unsettle foreign investors and threaten the development gains made to date if not contained. Thus for Vietnam, the choice is clear: it should restore macroeconomic stability rather than try to pursue high growth.

While many countries in the region are also experiencing high inflation rates, the increase has been abnormally high in the case of Vietnam. The year-on-year consumer price index (CPI) reached a record 26% in June. This was mainly due to the rapid rise in food prices, but even core inflation (which excludes food and fuel) is estimated to have increased 15%.

Some of the causes of Vietnam's high inflation are externally induced, but others are home-made. For an open economy such as Vietnam, dramatic increases in the international prices of food, fuel and construction materials have a large impact on domestic prices.

For instance, the export price of Vietnamese rice more than doubled within just three months, to around $700 per tonne in March. This helped to push domestic rice prices upwards as well. Food prices were also adversely affected by a severe winter, avian flu and livestock diseases. Food inflation quickly permeated into non-food areas as well. The prices of housing and construction materials increased as demand for houses, industrial and commercial complexes remained strong as a result of high investment.

Vietnam's exchange rate system, which is a de facto peg to the US dollar within a narrow band, compounded the inflationary problem. Preserving export competitiveness required that the booming foreign investment inflows last year be "sterilised" to prevent dong appreciation. Accordingly, the State Bank of Vietnam (SBV) purchased large amounts of foreign currency from the banking system. The move, however, was not enough to fully sterilise the liquidity inflows to the economy, leading to large monetary expansion.

The excess liquidity in the system combined with the rapid expansion of the joint stock banks, resulting in a sharp acceleration in domestic credit (by 54% last year compared to 29% in 2006) mostly to the real estate and securities sectors. Such a pace compromised banks' loan appraisal procedures as well as their credit quality.

Thus, the unsterilised liquidity inflows, unusually high domestic credit growth, expansionary fiscal policy, and aggressive public investment were the principal home-made causes of Vietnam's high inflation.

Signs of overheating The signs of overheating of the economy are evident in infrastructure bottlenecks (such as severe electricity shortage and congested roads and ports), a tight labour market - with skilled and semi-skilled labour supply falling far behind demand - and a sharp widening of the trade and current account deficit. The trade deficit in the first half (around $15 billion) was already higher than for the whole of last year ($12 billion), while the current account deficit is running at an alarming level of around 10% of GDP.

It is little surprise, therefore, that the non-deliverable forward rate of the dong in offshore markets is considerably more depreciated than the official spot rate, indicating that the dong is under heavy downward pressure. As people hedge against high inflation, there are indications of liquidity being converted into gold.

Under such circumstances, curbing inflation, restoring macroeconomic stability and engineering a soft landing of the economy have become the most important tasks facing Vietnam's government.

Government response Appropriately, the government in February and March switched its priority from pursuing high growth to macroeconomic stability with a downward adjustment of growth target from 8.5-9% to 7% for this year. The government also announced its plan to pursue tight monetary and fiscal policies, cutting back state expenditures and public investment projects with a view to reducing trade deficits.

The prime interest rate has been raised three times to reach 14% on June 11. The credit growth ceiling for the commercial banks has been set at below 30% for the year and their credit for real estate and stocks has been restricted to 3% of their total loans outstanding.

The reserve requirement ratio (the proportion of deposits banks hold in the form of cash reserves) has been increased significantly from 5% to 12% effective from June 27. Banks have been required to purchase central bank bills worth about $1.3 billion in a move to mop up cash from the banking system.

By way of maintaining exchange rate flexibility, the daily US dollar/dong trading band has been doubled to plus or minus two percent from the prevailing official rate.

Administratively, the price freeze on several essential goods and services has been extended to the end of the year.

Thanks to all of these measures, there are some signs of inflation easing. The credit controls and cuts in investment projects have also brought imports down, helping to reduce the trade deficit from nearly $3 billion in May to $1.3 billion last month.

But concerns remain about whether these measures will be enough to bring inflation to a manageable level. For instance, sales of SBV bills have been insufficient to slow credit growth. There may therefore be a need for further interest rate hikes.

Considering that the pegged exchange rate has limited the central bank's degree of monetary management, a greater degree of exchange-rate flexibility (with due consideration for export competitiveness) could be an option to improve the effectiveness of monetary policy and neutralise the inflationary impact of capital inflows. On the fiscal side, more cuts in public investment projects (on top of those already announced) may be needed. Off-budget investment projects also need to be reined in. And portfolio capital flows and interbank transactions may need to be closely monitored.

Good mid-term outlook Exposure to global markets has inevitably complicated Vietnam's macroeconomic management. Notwithstanding tighter monetary and fiscal policies, inflation this year is expected to remain high. While it may slow next year, it will still be at double-digit levels. Thus the immediate economic outlook is volatile.

However, healthy FDI inflows during the first quarter of this year and unabated inflows of remittances (expected to reach around $8 billion this year) are among the signs that investors are giving the government's anti-inflationary policies the thumbs up.

If these policies are strongly enforced, and demand pressures and inflation brought under control, Vietnam's prospects for sustained growth in the medium term will remain good.

The author is visiting senior research fellow at the Institute of Southeast Asian Studies. The views in this article are his personal observations. This story was first published in Business Times (Singapore) on July 25

You see, the funny thing about growing is that there are always the inevitable growing pains. You hear about them and know people who may be going through them, but those growing pains, once you have them, are kind of like the dull ache you feel when your wisdom teeth are pushing through your gums trying to get out on the other side. You can always tell when you are growing when things that once felt right, people you once felt comfortable with, and/or places or activities you once thoroughly enjoyed start to feel a little bit different. That is the dull ache I was speaking about -- you see, the change occurring within you always starts as a dull pressure on your heart, your mind, and your spirit...always. When you sense this dull pressure, you will be tempted to let it roll off your back or even ignore it.

Don't ignore it. That dull pressure is your soul's way of speaking to you to let you know that gradual and/or sudden change is on its way. Trust me when I say that the more you try to ignore it, the more the pressure persists. It persists in that you begin to not just see things differently, but it actually becomes easier for you to see things differently and notice things that you never noticed before...which will most definitely shock you. And as the pressure persists and you begin to notice aspects of your current situation, friends, job, life that have always been there but you just never noticed -- you will be a bit shocked. Just as you are a bit shocked at how quickly the dull ache in your gums turned into a sharper pain.

As this pain becomes much more acute in your mind's eye, you are forced to at least acknowledge its presence. And once you acknowledge its presence, there is no turning back. There is no going back to living as if you do not sense the dull pressure that has now turned to a slight pounding. You will not be able to pretend, at least not for very long, that everything is just as it has always been or that you feel oh so peachy keen with how things currently exist. They always say the first step is getting past the denial -- and trust, once you do that, you will always end up having to take action, make a choice.

However, how long you take to intiate action, make a choice, do something is entirely up to you and entirely up to how long you old on to your past self. We are constantly shedding old layers of ourselves, just as snakes are constantly shedding their old skins. But just as a snake cannot really move forward all that well, if at all, as it sheds its old skin -- you cannot move forward until you shed your old layer. The similarity between us and snakes is that this shedding is inevitable, either we consciously make a choice for a change or we subconsciously place ourselves in situations where the choice is seemingly made for us. The difference between us and snakes is that we can truly prolong our shedding process by trying not to let go.

It is extremely hard to let go. To let go of one's past self, the people, activities, situations, locations that "make" you who you are is extremely difficult to do. Or so it seems. What you think these people, activities, situations, locations, etc. make you is only who you are for this stage in your life. You are only these identifiers for this time being until it is time to shed again...until it is time for a new layer of who you really are to emerge.

I don't write this to sound callous or preachy...in fact, I write this with tears in my eyes because I am going through it right now...I am struggling to let go of a layer of myself that I know now can no longer be a part of who I am growing into. And although I know it makes more sense to let go of this layer so that the now pronounced sharp pain can finally end, it is so much more comforting to stay with what is familiar and old, even if I have to contend with the pain. I am scared to find out what is next for me...what this means for my future with other individuals in my life...or even if it is all just in my head and I am imagining this "shift". It is really scary to face...however, when I am sitting quietly with myself and I am truly honest with myself, I know that I will have to let go of my old self and those people, activities, places, etc. along with it.

I don't know how long I am going to keep holding on to my old layer nor how long I am going to contend with the pain on my heart, mind, and spirit -- however, I know that I will eventually shed my old layer and finally stop the pain. I know that I will honor my old self for carrying me up until this point and do my best to allow those people, places, and things that I am leaving behind to understand that it is not solely about them, but it is about our no longer having a space of convergence. I can only pray that when I do let go, that I have no regrets and that I let go with a peace of mind and a song in my heart...I can only pray.

Or one that has taken on a laze fare surrounding

I ask that you do not negate my loyalty or commitment

Because you are incapable at this time

Do not try to re-write the meaning

To suit your limited outlook

I have been here for you, and will continue to

Why, because I recognize you

I have fears and anger that want to take the softer easier way out

I am a runner by nature….I do not want to feel

I have been loyal to my fear and anger

And that has kept me running

I now choose to be loyal to my growth

That will keep me free

We wanted to better understand how email can help entrepreneurs establish and build strong business relationships online.

With Matt's help, we unearthed some of the key issues and misperceptions about email and email marketing. Moreover, we got a handle on just how complex effective email marketing can be along with plenty of practical tips and advice from an email marketing guru.

So, here are a handful of some critical lessons in a Q&A format:

Q: Why should an entrepreneur consider/use email as part of their marketing efforts?

A: Email, when developed and delivered responsibly, is: 

• Efficient (i.e. it can deliver marketing results)
• Cost-effective
• Immediate
• Measurable
• Easy to use

Q: What are some of the critical issues that entrepreneurs should be aware of so that they can hone their email marketing efforts?

A: Entrepreneurs need to address ways of:

• Ensuring email actually lands in the intended email box
• Building and sustaining a database of people who look forward to receiving email
• Setting and maintaining a deployment schedule that provides the best results
• Periodically testing elements of email to achieve the best results

Q: What are some of the greatest misperceptions about email marketing that can potentially damage an entrepreneur's relationship building efforts?

A: Just because you send out email, you can not assume that your email:

• Always gets delivered to the email boxes you are targeting
• Always arrives when you need it to arrive
• Recipients see the email the way you designed it
• Recipients will always actively engage with your email

Matthew strongly recommends using the services of responsible email marketing services - which allow you to delegate the tasks of developing and delivering email to companies that can do it most cost-effectively. Find a list of email marketing services (organized by county) at a useful resource developed by the email marketer's club.

In the next few weeks, we're going to have Matt back in the BusinessCast bagel shop and we're going to run through a very practical 'soup to nuts' scenario - whereby we cover the main points of an effective campaign in case-study format. So, if you're planning an email marketing campaign, looking to hone your existing campaign or if you've been looking for an excuse to launch your first campaign, let us know. We could use your campaign as the focus for our discussion.

Our 'modern life' is undergoing a change.  It has to.

The planet on which we live is changing its ways.  The voice can be clearly heard in howling winds of tornadoes, driving rainstorms and floods, the hiss of rampant wildfires, and the deep rumble of earthquakes. 

Resources which we have long taken for granted will one day run out.  Then what? We've already seen the affects of weather changes on the food supply. Drought has hit some areas while other places have drowned.

Government and industry leaders - each looking out for it's own best interests - have lined their pockets, ignorant or unwilling to face responsibility OR reality.  Who cares?  It's not their problem! Sequestered off in their own private heavens, their souls have been sold for the almighty business deal.  The greed of the dollar has won out again, trumping the needs of the people and the planet.  These people, our corporate leaders and politicians, who should be serving (we'd like to think) us are serving themselves.  The result?  A system that is breaking down..., and quickly.

Greed - look where it has led us.  Worldwide we find ourselves staring into the jaws of hell;  pollution, corruption, greed, economic collapse, shortages, wanton disregard for others.  "Me..., Me..., ME" has ruled for too long.

We will find ourselves going backwards.  It will become more evident that we have to start to do what our parents, grandparents and great-grandparents did:  relate to one another, interact with our communities.

As resources dwindle and prices rise, we will have to plant that garden with our neighbors; reclaim a vacant lot to feed each other.  We'll have to get our hands dirty doing more with less electricity and wasteful practices. We'll have to become more resourceful instead of wasteful, cutting back on frivolous things;  getting to what matters:  our family, friends, neighbors and community and the planet.

This is for our own sake....

What are you doing to promote the change that has to be, in your life, your neighborhood and for the world?

"When the Power of Love overcomes the Love of Power, the world will know peace."  Jimi Hendrix

i made the statement "it's only when we realize what assholes we are that we stop manipulating people."  i thought it was a pretty straightforward thing to say, regarding recognizing our flaws and the things we do to other people inadvertently...and how we can only stop doing harmful things to each other when we finally realize we're doing them, and own up to it all, even if only to ourselves.  this is something i have had to work with regarding myself and my own relationship with the world and everyone in it...and i found it to be a fair assessment of interpersonal growth.

but i think it made him angry.  any thoughts, beloved readers?  i've been told to let it go; seems maybe i touched a nerve that was none of my business?  but i have trouble letting go of stuff like this.  bleh.

Anyways, the last order has finally gone through for the plexiglass towers. The order should be in on Monday or Tuesday which means the following:

1. The website will be set up and ready to roll by the weeks end.
2. Announcements will be made to inform you its ready.
3. At that time we will have 11 kits ready to go (hey we are still small give us time lol)
4. The manuals will be ready MINUS the CD/DVD (still working the kinks on that issue)
5. All prices will be set by that time with Important Notes concerning the process and kit

So there you have it... we have been working each issue diligently during the time off work we have had. My apologies to all of you who want these kits and the info to build one yourself. As of now I still have a job to do as do most of you :) If anything just be ready to save some money and if you wish to build for fun and profit, get ready to rake in the paper. Spread the word... Its about to get good!

I've been reading quite a bit of Tim Keller lately and his work on the topic 'city' and the gospel. It's been getting me all riled up. It's incredible reading about the way he used to preach and the revelations he's had since then that make him the man he is today. I'm so thankful that he and others put their work out their so that young ministers like myself can pick it up and go beyond where we could otherwise. It just fires me up! 

Anyway, I'll podcast the message after Sunday and post the link here for any and all to download and make sure I didn't preach any heresy or anything.

Scoopit!

Bloomberg reports on the rising land prices in Uruguay and the impact of foreign investment in agriculture, specifically citing PGG Wrightson.

A third of Uruguay's agricultural property may now be owned by foreigners,

according to Uruguay's Rural Association. They include farm companies PGG Wrightson Ltd. of New Zealand and Buenos Aires-based Adecoagro, which is backed by billionaire investor George Soros.

International buyers, seeking to take advantage of rising global food prices, are attracted by the South American country's relatively cheap land, policies that encourage foreign investment, and no tariffs on farm exports, said Roberto Vazquez Platero, a former agriculture minister. As a result, farm prices have more than doubled in three years

Read the piece here.

God is Good All the Time,

All the Time, God is Good.

So Speak Out!

As part of the 1998 Comprehensive Plan update, a public survey was undertaken with 325 surveys distributed of which only 110 were returned. The total number of survey respondents in
2008 represents a increase of 10 times over 1998 totals with 1171 total respondents.
Figure 1 shows a map of survey respondents by their home zip code.

[caption id="attachment_947" align="aligncenter" width="499" caption="Figure 1: Survey Respondents by Home Zip code"][/caption]

You can see the whole report by clicking on the image above or HERE

~LizFrog~

No Dora music on the way to work, turn on my tunes.  Turn Dora on again for a few seconds, then turn my music on. Thinking to self, didn't tell daddy to turn pot handles in, or to put frozen peas in M's soup to cool it off.  Did not tell daddy to make sure N blows his nose in tissue not sleeve.  Make sure to give medicine!  Breathe

Work, relax job to do. Work hard, do tasks. Call daddy- everything is great.  What, kids should be crying, running around yelling tearing stuff off the walls- demanding and getting sugar, candy.  Feeling a little jealous.  Keep working enjoy the peace.  Not making millions, just helping people out who need a hand. Helping out at home with the money I make.  Providing a little more.  Last hour, could this clock move any slower?

Driving home, can I get home any quicker, police escort?  Pull into driveway, sit in the car one more second, listen, peace.  Breathe.  Walk into house, smiling faces, questions, hugs and kisses.  Best feeling EVER!

"...comfort nudges us dangerously close to complacency, and nothing good comes from that. It kills businesses, dulls lives, and encourages nothing better than ordinary. Our greatest blessings come from people who refused to be complacent, whether it was Beethoven or the Beatles."

Too much of comfort is not a good sign - and managers/leaders needs to constantly introspect, ask difficult questions to self and be on the edge. I have seen many people in my career span who are averse to trying something new - because it requires them to move out of their comfort zone.

I was reading an article (not sure where!) on Intrapreneurship and I loved the term coined by author - "From Comfort Zone to Courage Zone". Journey from comfort to courage may turn out to be adventurous and even uncomfortable initially - but it is worth giving a try! Because that is where all the growth lies.

Update 07/26: Great and timely quotes on Confidence Building in today's Times Of India daily in Sacred Space. Here they go -

"You gain strength, courage and confidence by every experience in which you really stop to look fear in the face. You must do the thing which you think you cannot do. - Eleanor Roosevelt

If you have no confidence in self, you are twice defeated in the race of life. With confidence, you have won even before you have started. - Marcus Garvey

What  would you do?....you make the choice. Don't look for a punch line, there  isn't one. Read it anyway. My question is: Would you have made the same  choice?

At a  fundraising dinner for a school that serves children with learning  disabilities, the father of one of the students delivered a speech that  would never be forgotten by all who attended. After extolling the school  and its dedicated staff, he offered a question:

'When not interfered  with by outside influences, everything nature does, is done with  perfection.
Yet my son, Shay, cannot learn things as other children do.  He cannot understand things as other children do.  Where  is the natural order of things in my son?'

The  audience was stilled by the query.

The father continued. 'I believe  that when a child like Shay, who was mentally and physically disabled  comes into the world, an opportunity to realize true human nature presents  itself, and it comes in the way other people treat that child.' Then he  told the following story:

Shay and I had walked past a park where  some boys Shay knew were playing baseball. Shay asked, 'Do you think  they'll let me play?' I knew that most of the boys would not want someone  like Shay on their team, but as a father I also understood that if  my son were allowed to play, it would give him a much-needed sense of  belonging and some confidence to be accepted by others in spite of his  handicaps.

I approached one of the boys on the field and asked (not  expecting much) if Shay could play. The boy looked around for guidance and  said, 'We're losing by six runs and the game is in the eighth inning. I  guess he can be on our team and we'll try to put him in to bat in the  ninth inning.'

Shay struggled over to the team's bench and, with a  broad smile, put on a team shirt. I watched with a small tear in my eye  and warmth in my heart. The boys saw my joy at my son being  accepted.
In the bottom of the eighth inning, Shay's team scored a few  runs but was still behind by three.
In the top of the ninth inning,  Shay put on a glove and played in the right field. Even though no hits  came his way, he was obviously ecstatic just to be in the game and on the  field, grinning from ear to ear as I waved to him from the stands.
In  the bottom of the ninth inning, Shay's team scored again.
Now, with two  outs and the bases loaded, the potential winning run was on base and Shay  was scheduled to be next at bat.

At this juncture, do they let Shay bat and give away their chance to win the game?
Surprisingly, Shay was  given the bat. Everyone knew that a hit was all but impossible because  Shay didn't even know how to hold the bat properly, much less connect with  the ball.

However, as Shay stepped up to the
plate, the pitcher,  recognizing that the other team was putting winning aside for this moment  in Shay's life, moved in a few steps to lob the ball in softly so Shay  could at least make contact.
The first pitch came and Shay swung  clumsily and missed.
The pitcher again took a few steps forward to toss  the ball softly towards Shay.
As the pitch came in, Shay swung at the  ball and hit a slow ground ball right back to the pitcher.

The game  would now be over.
The pitcher picked up the soft grounder and could  have easily thrown the ball to the first baseman.
Shay would have been  out and that would have been the end of the game.

Instead, the  pitcher threw the ball right over the first baseman's head, out of reach  of all team mates.
Everyone from the stands and both teams started  yelling, 'Shay, run to first!

Run to first!'
Never in his life had  Shay ever run that far, but he made it to first base.
He scampered down  the baseline, wide-eyed and startled.Everyone yelled, 'Run to  second, run to second!'
Catching his breath, Shay awkwardly ran towards  second, gleaming and struggling to make it to the base.
By the time  Shay rounded towards second base, the right fielder had the ball .. the  smallest guy on their team who now had his first chance to be the hero for  his team.
He could have thrown the ball to the second-baseman for the  tag, but he understood the pitcher's intentions so he, too, intentionally  threw the ball high and far over the third-baseman's head.
Shay ran  toward third base deliriously as the runners ahead of him circled the  bases toward home.

All were screaming, 'Shay, Shay, Shay, all the  Way Shay'

Shay reached third base because the opposing shortstop  ran to help him by turning him in the direction of third base, and  shouted, 'Run to third!
Shay, run to third!'

As Shay rounded  third, the boys from both teams, and the spectators, were on their feet  screaming, 'Shay, run home! Run home!'
Shay ran to home, stepped on the  plate, and was cheered as the hero who hit the grand slam and won the game  for his team

'That day', said the father softly with tears now  rolling down his face, 'the boys from both teams helped bring a piece of  true love and humanity into this world'.

Two to three weeks
Eyes start opening by day 14 and babies start exploring their world outside the nest. They start nibbling grass hay and sometimes even mom's pellets but still rely on mothers milk for a majority of their nutrition. Babies at this age spend a lot of time perfecting their balance and hopping skills.

Four to six weeks
Babies spend most of their time out of the nest box. Their eating solid foods and drinking water. Babies still try nursing on mother if she will let them. Weaning can begin at six weeks of age for some of the smaller breeds.

Maturity
Rabbits reach maturity somewhere between 6 and 10 months of age depending on the breed. Smaller breeds mature quicker than larger

(Article adapted from: http://islandgems.net/development.html)

Who's got time to develop a business plan?!? 

If you’re like most entrepreneurs, you can certainly support the idea…but, when push comes to shove, you’re focusing on the day-to-day activities more than planning where your business should be going.

When we tackle the need for Fine Tuning Your Business - show #58 we are sensitive to that reality. At the same time, we know there are so many conventional resources available for developing business plans that it is often very hard to get excited about pulling a plan together – one that you’ll want to update during critical stages of your business such as expansions, increased competitiveness and/or calamities.

Rather than suggesting you adopt a traditional business plan, we recommend you create a "Passion Plan” - a plan that tells the inspiring and unique story about your business - within a business plan structure.

Why? Because, only plans that effectively capture your energy and enthusiasm will really take root in the hearts and minds of those who have to live the plan each and everyday – i.e. your employees, your investors and of course…you!

Listen to Fine Tuning Your Business – show #58 and you’ll get other real-life practical suggestions that will help your business plan – and therefore your business – achieve new heights!

The infamous Twitter "fail whale"

Over the last few years, it appears that the word "fail" has become unspeakable, especially in the education world. Educators are told that use of the word discourages students, and in the wider world, we fear failure. I believe that be hiding from anything that may result in failure, we do ourselves a disservice. How many times did you ever have an idea or a dream, but never did anything about it because you thought you might not succeed? What if you changed your reality so that failure was no big deal, simply a lesson to be learnt? Can you see the possibilities opening up before your eyes?

Failure is deferred success

When I was a college student, I had a male friend, let's call him Brad, who never had a shortage of gorgeous girls lined up, girls way hotter than me, if you can believe that. Now Brad was a great guy, a great friend, but nothing more. And he certainly wasn't good-looking in any conventional sense. After about six months of observing this revolving door of ladies, I had to ask him how he did it. So here's Brad's secret:

Makes sense, but how many of us sit on the sidelines of life afraid to ask because we'll get knocked back?

Failure shows that you're a success in the making

Think about it - if you've failed at something, it means that you gave it a go and you put some effort in. This is true whether it is trying a new sport and deciding it's not for you, or failing at something much bigger such as an important exam, a relationship or a career. How many people wouldn't even take on the challenge? My experience as a classroom teacher ended in failure after three years, but I know many people who would never even entertain the idea of teaching. I am not ashamed to say that I failed at my chosen career, because as it turned out, teaching was a springboard into the work I am doing now, advising young people on jobs and careers.

Failure gives your life a spring clean

Have you ever been dumped by a boyfriend or girlfriend and thought it was the worst thing ever and the world was ending, only to end up feeling grateful to them for vacating your life and leaving room for a better relationship? Failure is not the end, it is merely a difficult step we have to get over in order to improve our lives.

Facing failure head on takes courage

As part of my job, I see many students who change their plans during their time at college. There is still such a huge stigma to dropping out of a course or failing an exam, but why? We all have hopes, desires, dreams, plans (thank goodness), but as someone once said, "Life happens when you're making other plans". If things aren't working out the way you would have liked, then that's your inner bell sounding a wake-up call. Facing up to the fact that something needs to change is the hardest part and you must have the courage to do that for yourself. Life change is hard work. The good news is that once you have taken that step, there's plenty of help out there, and you can find yourself in a better position to move forward.

Failure teaches you humility

It does you good to stuff up now and again. To be in that position where you have to back down and say "I got it wrong". People respect people who are not afraid to make mistakes and admit to their mistakes. Who wants to be right all the time anyway?

If you've ever failed, you're in good company

Enjoy this short YouTube video.

If you've never failed, you've never lived.

Scoopit!

Earlier today the RBNZ lowered the OCR. Whilst seeming to meet with approval by some, see this item on bank economists' reaction at NBR, it was not greeted so enthusiastically by others including Bernard Hickey at Show me the Money and The Visible Hand in Economics, nor by this blogger. Though a number of others have welcomed the cut.

Whilst working on a post on other aspects of the implications of the OCR cut, from Adam's perspective - to appear later, he recalled a recent article in The Economist of 12th July which he thought might be worth drawing people's attention too.

This article is entitled - The ghost at the till:-

The article concludes:-

The test will be whether or not inflation is heading down by the end of this year. If it is not, more drastic action will be required, which might make a big dent in economic growth. The wiser among the region’s politicians know that, costly though it may be, the fight against inflation is one they cannot afford to lose. Already, price rises threaten to tip several million Latin Americans back into poverty. Brazil’s president, Luiz Inácio Lula da Silva, though a man of the left, has given strong backing to the Central Bank’s bitter medicine. Inflation is a “degrading disease”, he says. It is a malady that long debilitated Latin America. That is why the region is relatively intolerant of it now.

What struck Adam as he re-read the item were some of the parallels that appear to exist between some of the countries cited and New Zealand.

One paragraph Adam found especially interesting was this one:-

The regional average inflation rate rose to 7.5% in April, from 5.2% a year before, according to the IMF. This is an underestimate, since Argentina’s official inflation figure of 9.1% is probably less than half the true rate. It also conceals a divide. Around the turn of the decade, several of the larger countries adopted floating exchange rates, and inflation targets administered by more-or-less independent central banks. Another group of countries—including Argentina and Venezuela—have given greater priority to growth than to price stability. But even among the first group, inflation has been rising. In response, central banks in Chile, Colombia, Mexico and Peru began to raise interest rates last year. Even so, they have missed their inflation targets, in most cases for the first time (see chart).

Sound familiar in any respect? Now the parallels are not exact, but they do provide food for thought. Indeed, given the desire by some politicians - such as Trevor Mallard and Winston Peters to move towards a more growth centric model and away from an inflation targetting model, the experiences of this group of countries should perhaps be looked at to see if there are any lessons to be learned.

These following comments on Brazil were interesting also:-

To howls of protest, Brazil’s Central Bank halted three years of monetary easing last October. Since then it has raised rates by a percentage point. Even so, inflation is nearing the upper limit of the target of 4.5% plus-or-minus two percentage points. Two things that have helped to contain price rises in Brazil for the past few years—cheap goods from the rest of the world and a strengthening currency to buy them with—have now run their course, notes Marcelo Carvalho of Morgan Stanley, an investment bank.

After initially grumbling that higher rates were making the real too strong for Brazilian industries to compete, the finance ministry is now supporting the bank’s efforts. In June it tightened fiscal policy, raising its target for the primary surplus (ie, before debt payments) from 3.8% of GDP to 4.3%. The authorities are optimistic that inflation will be falling by the end of the year. But ordinary Brazilians are alarmed by the rise in the cost of a staple basket of food—up by as much as 50% in some parts of the country, according to DIEESE, a union-linked research body.

So, perhaps we should draw upon the lessons learned in Latin America, whilst not forgetting those we should be remembering from our own relatively recent past as well. Collective memory of past problems is sometimes a good thing.

Adam wonders also how in sync the RBNZ and Treasury really are? Perhaps the sync is more between some elements in the RBNZ and Cullen's office, as Treasury seems to have very quiescent in recent times on a number of the decisions taken.

I think reading and hearing about people who love God and live their lives according to it is such an encouraging thing (which reminds me, I should really read more of those "Sunday School prize" books I have); and one example, aside from all the John Pipers and Matt Redmans, is my dearest Partner. I see in her life the desire to follow His will, to love according to His will, and to apply whatever she learns the best she can. I see how God has changed her from the girl who preferred dance and lindy to one who wants to dance only in Him; I see how relationship "issues" are all settled in His hands – and when I look at you, I learn part of the lesson that God is teaching me now.

So, thank God that a few years ago, He decided to chuck us together during service and we decided to zhao and have breakfast; and thank you for being a part of my life ever since! (Without you there would be no 1-for-1 Italian dinners.)

John Edwards was in town today, going on about how things are so bad in Houston. I guess he hasn't read any newspapers recently, but what with the terrible busyness that comes with not being his party's candidate, we can cut him some slack for that.

From Newsradio 740:

[Edwards] says Texas ranks 44th among all 50 states in terms of homeownership and sixth in foreclosure rates.
"We need to help families build assets, and organize workers so they can earn a better wage," Edwards adds. "The foreclosure crisis is a huge issue in Texas and especially in Houston."

My gut level reaction to these statements were that Edwards was blowing smoke. But to be sure, I did a little research.

First, the most minor of beefs: Texas isn't 44th, it's 43rd.

However, this is an extremely insignificant number. Why? Because, when we look at the actual rates of homeownership, 40 of the 50 states fall within 4% of the national average, which is 68% homeownership. Texas comes in at 66% in 2007 - significantly ahead of our peer states (California: 58.3%, New York: 55.9%).

Moreover, the idea that homeownership is idential to prosperity doesn't hold a lot of water these days. Consider our top 5 homeownership states: #1 West Virginia (77.6%), #2 Delaware (76.8%), #3 Michigan (76.4%), #4 Utah (74.9%), and #5 Idaho (74.5%). None of those states are economic star performers, and while Utah and Idaho have experienced signficant growth in the past decade, much of that has been retiring west coast urbanites who are specifically cashing out their pensions on more affordable housing in these interior western states. That's not a recipe for sustained economic health.

Now, onto the foreclosures bit. Texas has had a fair amount of foreclosure activity, but nothing compared to California, Nevada, and Florida. Consider the June data from RealtyTrac:

Only a handful of Texas counties are experiencing increased foreclosure rates, and those are the ones that are primarily booming suburbs - exactly the type of community that is crashing and burning in most of the rest of the country.

What's even more interesting is to look at the actual numbers, to see what kinds of places are having the most foreclosures. In general, foreclosure activity has hit the 'sub-prime' speculative markets the most, and these have typically been in areas that are the fastest growing. These people in general have bought too much house and can't afford it, even though they probably have decent jobs.

Sadly, the recent surges in fuel and food prices, coupled with a soft economy, have lead to an increase in the more historically typical foreclosure type: people running out of money who previously were comfortable in their housing situation.

One solid general trend is that population growth occurs the most where the economy is hot, and the least where it's not. So, if we perform a simple comparison of population growth to foreclosure rates, we find a statistical picture that much more closely resembles the 'vibe' on the street.

When we rank those two factors together, the US looks like this:

So here we see Texas comes in strong, at #11 overall. Of the states that have seen any real growth in the last decade, Texas is only surpassed by North Carolina and Delaware. Of the high-growth states, Texas comes in WAY ahead of places like Nevada (#31), Florida, (#34) and California (#41). Poor Michigan and Ohio come in at the very bottom... not surprising considering their economies.

To see the complete data list I used to crunch these scores, click here. (This is a PDF printout of an Excel worksheet, if I can get WordPress to upload Excel, I will)

I think it's imperative that we evaluate the kinds of claims these politicians are making in this context. You can make any data sound extreme and important when you change its context, like his claim that we are "44th out of 50" (really 43rd) in home ownership, without mentioning that the entire US does pretty well at this and that we're within 4% of the national average.

The truth is things are going pretty well in Texas, and while there has been some shady lending that has lead to a slight rise in foreclosures over historical averages, we've managed to duck under that crisis for the most part. The bigger problem Texas is going to continue to face is managing its population growth, and with Texas being one of the only places in the country one can find a job these days, that growth may soon pick up even more than the breakneck pace it's held for the last two decades.

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Anyone have thoughts on the subject? Leave a comment!

From the advent of the industrial age North Alabama was a source for cheap labor. Our vast river systems made it possible for various companies to set up shop here, hire from our large labor force and produces products that could be sold at a profit. The Tennessee River remains a main thoroughfare taking barge loads of product to the Gulf of Mexico.

Rich soil and a preferable climate made it possible for bumper crops of cotton to be produced in the region. My Great Grandfather Fuller received several hundred acres in a land grant as he journeyed south to cultivate an area in Western Morgan County. Many of the native Alabamians first came here through similar means.

July 3^rd 1941 The War Department announced that a site on the southwestern edge of Huntsville, Alabama, had been selected as the location for a new chemical munitions manufacturing and storage plant. That was the birthing of what eventually became Red Stone Arsenal. The military brought some of its best minds to North Alabama forever changing the cultural landscape of the Tennessee Valley. In the 1960's the Marshal Space Flight Center was also established in Huntsville to help in fulfilling President Kennedy's vision to put an American on the moon by the end of the decade.

So you might compare our culture to a dish of southern friend chicken topped with béarnaise sauce. Not what you would expect, but interesting none the less.

Where does that leave the mission minded Christian? How are we to engage this culture? It seems that the Tennessee Valley is responsive to what Adrian Rogers called, "Doctrine Aflame". Many of our native Alabamians were raised on an Appalachian style of preaching that was infused with passion and delivered with the utmost sincerity. Our beloved transplants bring a scientific mindset that is accustomed to thinking deeply and logically on various issues. The two marry to produce what I believe is an effective form of ministry in the Tennessee Valley region. This is where D.A. Carson meets Johnny Hunt - Billy Graham meets Francis Schaeffer. The effective ministry that will reach the cross section of Tennessee Valley culture must have a zeal that is in accordance with knowledge.

As I was reading another blog, Michelle wrote about her efforts to change her negative behaviors into more productive ones.  She cited the behaviorist notion (more a correlated truth than theory now) that it takes 21 days to create a habit.  I learned this in Human Growth and Development classes years ago while taking nursing, but it took me a minute to realize this woman was talking three weeks (3 x 7 = 21, duh!), which is how I learned it.  Her determination got me to thinking (for she's earnest about change) about my own habits.

"Baby steps to the door..."

The B. F. Skinner experiments on behavior development pointed toward three weeks to create a habit and six to break it.  This means that if we are to extract a bad thought pattern that has taken years to create ruts of thoughts in our minds, it might take a lifetime of effort to fill in that rut and redirect our thinking to another grooved pattern.  Yet her goal of living intentionally mirrors the need for change all of us have in us.  The one thing I've learned (and I think she inferred) from my own life is that it takes small victories at first to win the war.  So, whatever time it took to make a habit, it will take twice as long to break it, if I remember my class accurately--which is always a question to be taken into consideration.

"Baby steps to the..."

Many of us think that if we can't conquer a habit or attitude in one fell swoop, we have failed, when in actuality this isn't how we develop a habit or conquer it.  I always refer to the movie "What About Bob" because in a most hilarious way they present a truth that goes beyond just comedy and realize the truth of how we grow.  It takes small steps out of the hospital after recovering from a surgery, or none at all if we leave in a wheelchair, and once we go through therapy for whatever bone, muscle or procedure we had done, the bigger steps come naturally.  We will ignore "Death therapy" for now.

In other words, we have to develop those big bites of accomplishment rather than merely expecting ourselves to blow past it without effort.  Yet this is exactly what is needed to be able to win the war.  On the other hand, developing a good habit speeds up the process of change especially if it replaces an old one.  Og Mandino, in a book called "The World's Most Successful Salesman", said,  "I will make good habits and become their slaves..."

As our lady above intimated, we are creatures of habit and unless we set up new ruts of behavior, our old ones will dominate.  This may take longer than we want, but the results are worth it.  I believe we also need to lighten up sometimes because we take ourselves and the world too seriously.  I read recently a corrolation study which indicated that cancer patience who kept a positive attitude healed at a higher rate than those who gave into despair and anger.

I want to change my life's outlook and accomplish many things before my dime is up (sorry, now it's 35 cents) so I'm not willing to remain in a stupor or mind-numbing habits for the sake of just getting through.  No, I want to live the adventure and if this life is all there is against all hope to the contrary, I want to have lived with gusto, loved madly, made love in every sense of that word with all my heart, soul and mind, and given those who come after me an example of living to inspire them to do the same.

Thanks, Michelle, for making me think about this again.