Stock markets in the United States got off to a good start
last week, heading higher before stumbling over China’s currency news.
China, which has one of the world’s largest and fastest
growing economies, is experiencing a slowdown in economic growth. The Economist reported data released
last week showed, “…an 8 percent fall in Chinese exports in July and a 5.4
percent drop in factory-gate prices. Output prices have fallen for 41 straight
months, a symptom of overcapacity in much of China’s heavy industry.” MarketWatch suggested China may be in (or
on the verge of) recession.
In an effort to slow its slowdown, China announced an
unexpected devaluation of its currency, the renminbi, last week. Don’t confuse
the terms renminbi and yuan. Renminbi is the name of China’s currency. Yuan
describes a unit of that currency. For instance, when shopping in China, you
would not ask how many renminbi you owed, you would ask how many yuan you owed.
Barron’s questioned whether
China’s relatively small currency adjustment would be enough to help its
economy and speculated last week’s devaluation could be the tip of the iceberg:
“One wonders what a 3 percent adjustment in the yuan will do
to spur China’s economy… To a longtime observer of finance ministers and
central bankers, the claim that the initial moves to tweak currencies will
suffice is a familiar refrain. The larger the underlying imbalance, the larger
the eventual exchange-rate adjustment.”
A Fed spokesman told The
Wall Street Journal China’s new currency policy has significant
implications for the world economy and it probably won’t affect the Fed’s
impending rate hike.
The currency devaluation didn’t have a sustained affect on
U.S. stock markets last week. Major U.S. stock markets finished the week
higher. China’s benchmark national index was up for the week, too.
what does the
future hold? It’s not stuff most of us
think about every day, but we may soon be a lot more familiar with terms like brain
organoids, megascale desalination, Internet balloons, liquid biopsies, and
more. At least, that’s what the MIT
Technology Review reported in Breakthrough
Technologies 2015:
“Not all breakthroughs are
created equal. Some arrive more or less as usable things; others mainly set the
stage for innovations that emerge later, and we have to estimate when that will
be. But we’d bet that every one of the milestones on this list will be worth
following in the coming years.”
Here are a few of the items included on the list:
·
Brain organoids: In greatly oversimplified
terms, these are miniature brains that can be grown from an adult’s cells. They
may help researchers better understand brain disorders and develop effective
treatments.
·
Megascale desalinization: The world does not have
enough fresh water. One solution is seawater desalination. Thanks to engineering
improvements, reverse-osmosis desalination has become cost-effective.
·
Internet balloons: Imagine 15-meter helium
balloons with solar-powered electronics hovering 20 kilometers in the air (far
above commercial airline flights) and making the Internet available to people who
currently have no access.
·
Liquid biopsies: Someday soon, annual
blood tests may help diagnose cancer early. Gene sequencing machines decode
millions of fragments of DNA in the bloodstream, looking for specific DNA
patterns that indicate cancer. Knowing the DNA mutation behind a cancer may
also help physicians choose the most effective treatments.
It’s important to keep track of developing
technologies because they have the potential to disrupt industries and change
the way business is done.
Weekly Focus – Think About It
“Any
sufficiently advanced technology is indistinguishable from magic.”
--Arthur
C. Clarke, British science fiction writer
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