Hello Aspirant

I read with interest your essays which were very well written.

The admission of Taiwan into the World Trade Organization (WTO) on 1 January 2002, allowing direct investment by Taiwanese companies in mainland China and the easing of restrictions on the import of mainland goods has helped made economic relations between Taiwan and China more normal.

However, this issue of the economies of Taiwan and China does carry political sensitivities, and as such, I think no one would want to attempt to give you a write out for fear of engaging in a prolonged debate.

Why don’t you throw in another question. I am sure there are people out there to assist you.

With all good wishes in your future endeavors.

Dear Mr Geoette

Thank you for your advice.

I will certainly get back here as and when I have another question to ask.

Thanks again.

Dear Mr Glotynn/Mr Geoette, Sirs

I have here another question that needs help and advice. Could someone please assist?

"EURO notes and coins became legal tender, replacing national money in 13 European countries. The single currency, however, has been launched eight years ago, and is now an established fact of economic life. However, what has the respective governments done to ensure that its full benefits are felt?"

Thank you.

Dear Aspirant.

Whew! This is a tough question to answer. The reason why I say this is because you are attempting a paper that requires actual facts and figures to substantiate your opinion. Given the fact that the Euro dollar is an established currency despite its not to old history, economic professors and lecturers alike are egocentric elements who will not hesitate to take away marks from your paper for incongruities and inconsistencies of facts.

If I were you, I rather attempt questions of an accidental theory nature where you attack economic ideas and analyse pertinent economic issues in a witty, somewhat acerbic tone. You can also expound your ideas and also lay down counter-arguments, detailing possible fallacies in their rhetoric. This enables the professors and lecturers to probe the premises of your arguments and form opinions of the issues. Moreover, accidental theories usually steer clear of any political orthodoxy or economic jargon, making it refreshingly different from normative economics, which are equation-laden and politically unbalanced. That way, the marker has little chance to find fault with your answers.

Some, just to name a few, accidental theories are:

- accept default and avoid disaster
- uncertainties
- dawn after storm
- tough choice

However, if you insist on attempting the question, I would recommend you begin with an introduction delineating the founding of the Euro, its member states etc. An example is given below. Your paper should comprise the following:

- introduction
- future prospects of the currency
- other currencies pegged to the Euro
- economics of the Euro
- criticism
- conclusion

The net may be able to assist you with the topics I have just mentioned.

Good luck young man. All the best.


INTRODUCTION

Euro was introduced to world financial markets as an accounting currency in 1999 and launched as physical coins and banknotes in 2002. It was ‘GOODBYE’ to Clara Schumann, Vasco da Gama and René Magritte; bank notes that adorned the German, Portuguese and Belgian figureheads disappeared overnight, along with ten other currencies. From January 1 Jan 2002, the Euro population of 300m citizens had use of Euro notes and started spending their new money.

Euro replaced the former ECU at a ratio of 1:1 and is now managed and administered by the Frankfurt-based European Central Bank (ECB) and the European System of Central Banks (ESCB), composed of the central banks of its member states. As an independent central bank, the ECB has sole authority to set monetary policy. The ESCB participates in the printing, minting and distribution of notes and coins in all member states, and the operation of the Eurozone payment systems.

Economic Policymakers typically cite four criteria of the currency. The Optimum Currency Area (OCA) criteria is to evaluate the value of switching to a single currency.

There are three economic criteria namely ‘labour and capital mobility’, ‘product diversification’, and ‘openness’; and one political criterion called ‘fiscal transfers’. Since establishing a single currency over a region necessitates surrendering the ability to tailor monetary policy to local conditions, these four characteristics measure the ability of the economy to smooth local economic movements in the absence of a monetary policy.

c.c. Glot ... high time for you to unfold your arms liao

Geo, you're doing great!
Count me out over this issue, as I have too little knowledge about it to give any useful suggestion.

Geoette 師長雅鉴

首先容我衷心地感謝您的諄諄教導。

所謂行萬里路勝讀萬卷書。您的豐富經驗和誠實無私的建議值得我的尊敬和學習。學生在這裡向您敬禮了。

日後如有相同的經濟學疑問,可否請求您再次指導? 謝謝。

順颂 福安

Hi Aspirant

Thank you.

I do not deserve all those praises. If I can be of any assistance, I shall be most pleased to lend a hand.

Cheers.

Mr Glotynn & Mr Geoette, Sirs

Could you please help me argue the following statement. Thank you, Sirs!

"If we all like more money, why does the government not print a lot more? Could it not thereby solve the problem of scarcity 'at a stroke'?"

Quote:

Hello Aspirant

This question reminds me that it needed a wheelbarrow filled with money to buy a box of matches during the Japanese Occupation in Singapore.

I shall let Mr Glotynn and others pen their arguments on this issue.

Over to you, Glot.

Cheers.

I'm not good at explaining academically how the rules of economics operate in an economy system, but we know that a country publishes money notes according to the levels of her gold and foreign exchange reserves. Over-supply of the money in a country would naturally result in "monetary inflation" which makes everything be priced very high. Geo's example about the price for a box of matches describes this well. Consequently publishing more money does not solve any problem but causes new headache to the country's economy.