China's Development

How China became so rich? 

China nowadays is one of the potential countries in the world, but how they did this in a short period of time? China in the twentieth century was poorer than Cameroon; they suffer many crisis and revolutions against people in power. Mao the leader in China decided to invest in the heavy industry (coal, steel, etc) or to invest in agriculture. He thought that the bases of the other biggest countries like Great Britain, Germany or USA was the heavy industry, so he decided to decrease the level of production of rice to produce more coal and steel. This was the biggest error because a lot of people died because of hunger. Mao died, and Deng succeeded, he changed totally the idea of Mao and give incentives to people who cultivated and worked the land. This make that no more people died and China made profits exporting rise and cereals to other countries. Later China invested his money and tried to open his country to the world, to join the market and be a competitive player. 

Nowadays China still growing and wants to reach the top of the world over USA, will they reach that objective? What do you think?

Do you think that other countries like India, Brasil or African countries can be new future potential countries like the case of China?

TULIP MANIA

“The beginning of economic bubbles” 

As most of you know Tulip Mania happened in Netherlands around 1937. Tulip bulbs were a luxury product with an important value of power in the country, so everybody tries to have one or more in their houses. There were few tulip bulbs with different colours so they were really expensive and people compete and pay well for these bulbs. This makes that the price of tulip bulbs increase and people start to speculate with them, his price increase about 10 times and also people change houses for a tulip bulb! It was amazing! These facts lead to a big economic bubble and also a financial crisis. People start to buy bulbs like and investment, but at the end everybody had a lot of tulip bulbs imported for other countries and their price decrease a lot, then the tulip bulb has no value. It’s said that Tulip Mania was the first economic bubble.

And my question is why people are so stupid, and invest a lot of money in a plant? Tulips were flowers that everyone can cultivate in their houses. Anybody know that this was a big bubble which at the end will exploit? This example shows the fragility of the world economy.