I Started to Get Interested in Economics

Wendy finally decided to take spare time to attend the Finance MBA program of Cheung Kong Graduate School of Business. She has my full support for the decision. Good education makes people wiser, and happier, although I don’t think the degree has too much value.

Wendy’s Passion

Wendy’s passion for finance has lasted for years. After reading the incredibly thick book – The Age of Turbulence: Adventures in a New World by Alan Greenspan, she just finished another book about George Soros – another incredibly thick book. Wendy has the passion to talk with me about finance, and economics, just as I was passionate to talk with her about business, and some times even coding and other techs. I didn’t appreciate it as much as she wanted me to. We sometimes beg the other party to spend time just to listen what we learned. Interesting, isn’t it?

Public Lecture

I went to the Cheung Kong Business school in the Cypress Hotel (walking distance from Hongqiao Airport) to attend a public class by Professor Gan Li. To my surprise, this is a very good one.

With no offense, I attended other lectures on economics, and I could not understand what is going on (the fault is mine because I am lack of some basic knowledge on economics). Professor Gan’s talk on the Efficiency of Thin and Thick Markets (PDF) actually solved many of the problems I have.

Economic Matters

As CEO of Baixing, an online market place, it is hard to operate the market well without knowing some basic economic knowledge. Many of the problems we face are not longer technical issues – it is economics issues. The talk actually raised my passion about economics. I am so privileged to chat with Prof. Gan for about one hour afterward – my appreciation goes to him.

Opportunity Cost in China

One thing we talked was about the challenge for professors in the States to return to China. China is a place full of opportunity, and that makes the cost to be focused and patient quite high. That is exactly what I observed – there are few really good engineers (they are all turned into so-so managers, or businessman)…. I agree with the point – the problem of having too many opportunities.

14 thoughts on “I Started to Get Interested in Economics

  1. Tony

    MBA is waste of time and money. Better to take classes in philosophy and mathematics. I finished 1 year of MBA at Stanford and it’s totally useless.

  2. Jian Shuo Wang

    @Tony, just as the “Little Horse Crossing the River” story, it is a pretty personal matter – it may be useless for one person, and at the same time, valuable for another. No one can be sure about the impact of a program.

    @Jim, the economy laws governs in China (if it does not, that is an evidence that the law is not complete yet, and need fine tune). In China, government controls a lot – a situation discussed a lot in economics study. Even in the planned economy in first 30 years of the current government, economy laws still govern – in a way to punish the people who do not obey their order.

  3. Jian Shuo Wang

    Well. Wendy finally gave up her idea about going to Stanford, since it is not practical when we have Yifan. We don’t want to separate the family by the Pacific. In Shanghai (maybe in China), there are two choices – Cheung Kong and CEIBS. I preferred CEIBS, but after talking with Cheung Kong’s professor, and supporting staff, I just feel Cheung Kong is more down to earth.

  4. asdf

    Alan Greenspan has been fully discredited and is thought to be responsible by many to have caused the current financial crisis.

  5. zwiz

    “Ask five economists and you’ll get five different answers (six if one went to Harvard).” Other places the joke is that you can find a economist to prove and agree with any point of view you want to promote.

    While it is essential to understand the nature of human activity, I think a economists have taken a black eye, recently. We are now seeing results of what some “economists” have wrought, and its not good for most people or for the world. I see what is happening to some of the economies of the world right now, and more and more get the feeling that this is not the way it should be working. Perhaps Wendy will be the one to come up with a different way of thinking about economics that makes sustainability, the enviroment, and positive values for human improvement count more than profit or idealogy.

  6. Jian Shuo Wang

    @asdf, “Alan Greenspan has been fully discredited”, I know that, but that does not discourage me to read his book. I am ready to be discredited myself at any time – when the world don’t understand me. I admire many people’s courage and appreciate their wisdom when the whole world go against them. My favorite example is the time I.M. Pei designed the pyramid in Paris, before it was built… I actually love to read stories of those discredited people, and think hard about what my decision will be in their situation. What the world say should have no co-relation to what is the right thing to do.

    @zwiz, economists don’t have confirmed answer since economy is not as mature as physics, especially in the sense that it can only observe, but hard to do data based experiment, making it slower, and more inaccurate than other field. But, that does not prevent people to give another try to find out the answer.

  7. Soon

    Whether MBA is a waste of time depends on your background. For people who has business or finance background, MBA is a waste of time save that it may be a good place for networking. For people who has little or no business or finance background, it is indeed a very good programme to study as MBAs are generally less theoretical and more practical in its approach to the subjects.

  8. whling

    Dear Wang,

    I recommend the following link for your reading pleasure.

    http://mises.org/daily/3493

    What commented by ADSF was somehow right. But it’s clear to me that Alan did that for the benefits of the Americans to continue spending/enjoying their life.

    The US/Alan Greenspan has been taking us for a ride for decades. It’s hard to judge who is right who is wrong. Without US interference/free market theory, the rest of the countries in this world may still under monarchy system. Without the free market/capitalism, there will be no incentives for tech entrepreneur to expand as fast as it did in the past decades.

    Economy is based on real productivity, instead on speculative investments which has been driving the world nuts.

  9. whling

    Many know what have gone wrong in the economy. It’s just seems that no one cares to fork out a solution which may be painful. The world are lead by governments, and these ppl in the governments should do what is right. Their current action may lead to future destruction and burden our future generation.

  10. asdf

    It’s fine if Wendy is reading the book to get a glimpse into the mind of someone deeply flawed. I just wanted to point out that the reader should be aware of Greenspan’s major failings.

    From http://www.nakedcapitalism.com/:

    Greenspan’s big defense is that the financial crisis was caused by a “once-in-a-century” event.

    Forget about the fact that the “once-in-a-century event” couldn’t have happened if Greenspan’s Fed hadn’t:

    Turned its cheek and allowed massive fraud

    Acted as cheerleader in chief for unregulated use of derivatives at least as far back as 1999 (see this and this)

    And for subprime loans

    Allowed the giant banks to grow into mega-banks. For example, Citigroup’s former chief executive says that when Citigroup was formed in 1998 out of the merger of banking and insurance giants, Greenspan told him, “I have nothing against size. It doesn’t bother me at all”

    Argued that economists had conquered the business cycle, and that modern, technologically advanced financial markets are best left to police themselves

    Preached that a new bubble be blown every time the last one bursts

    Kept interest rates too low

    And did alot of other hinky things

    More importantly, as Nassim Taleb repeatedly points out, financial experts who don’t plan for rare events are like pilots who don’t know about storms.

    There are storms out there, Taleb says, and any pilot who doesn’t know how to deal with storms shouldn’t be flying. Similarly, no one should be in a position of financial leadership if they don’t know about – and plan for – the infrequent event:

  11. asdf

    Don’t mean to beat a dead horse, but according to some, Greenspan is not merely an incompetent official who didn’t see the crisis coming, but actually one of the central villians who pushed the imbalances past breaking point and destroyed those who gave correct warnings about the coming crisis.

    http://www.pbs.org/wgbh/pages/frontline/warning/

  12. dp

    what’s worse than not getting education is getting mis-educated, the modern finance theory based on Keynesian economics are flaw, or simply a propaganda program institute by the elites, the small group of people on the top of the pyramid. Greenspan and his predecessors are definitely part of it, our world is filled with business school kids who are educated by propaganda running around thinking they are saving this world. amen

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