Record Profit for Hyundai: Good News for Global Economy

In the last few days, we have seen good earnings from Apple and Google. So, it indicates that technological companies are going to do well and it is perhaps one indication that economic recession is coming to an end. Well, economic recession perhaps hit most the auto industry. So, the good earnings of Hyundai is perhaps another indication that things are going to become better for the global economy. Hyundai is a Korean company and it announced its earnings recently for the last quarter. The profit was excellent and defeated any kind of expectations. That is why, I am hopeful about the global economy.

Most probably we are going out of the recession faster than anticipated. The worst is perhaps over. However, we have to be careful that recession does not come back again quickly. We should learn some lessons from the recession. 

What can Japanese People Learn from the Economic Recession?

It seems that Japan is officially out of recession. So, the people should have some kind of sigh of relief at this moment. They should be happy but it is really too early to celebrate. May be the worst is over but the bad condition is not surely over. In fact, there are two things to worry for the global economy. Price of crude oil is increasing and it can be a cause of real worry for everybody including Japanese people. The second problem is that this time, there was less rain in India and as a result, Indian agricultural production would surely suffer a lot. India is one of the leading agricultural producers in the world. Well, the effect of Economic Recession is still evident in many places including in Miss Universe 2009 event.

So, India may need to import agriculture commodities next year and it can push the price of these products high in the international market. Well, I clearly remember that before the beginning of the economic recession- the same two things happen. I just hope that we are not heading for another recession before even getting out of this one. So, Japan should be on alert and should not celebrate at this moment.

Japan: Is Economic Recession Really Over?

Just a few days ago, we saw reports in the media that economic recession is over in Japan. There was around 0.9% GDP growth in April June Quarter compared to the earlier 3 months. This is welcome news for everyone in the country.

Business Week reported:

The big bounce—GDP plunged by at over 10% (annualized) in the previous two quarters—owes much to stimulus packages in Japan and around the world. Domestic spending, aided by an 8% rise in government expenditure, and earnings from exports both increased. The trend could continue: “We expect to see an acceleration in Japan’s real GDP growth rate for the July–September quarter,” Credit Suisse economist Hiromichi Shirakawa wrote in a note to clients.

At the same time, we have heard some news about Germany and France. It seems that things are going to improve in Korea too. Well, still I am a bit skeptical about Japanese economy. Its share market is not doing that much well and has become instable. I hope that Japan can come back strongly soon in the global economy.

Online payment can be a huge business opportunity in the time of economic recession

Now, all the countries are suffering from economic recession. In USA, the economic condition is very bad. Nearly 6 million people have lost job at the time of this recession. The loss of jobs have made many people worried and many immigrants are now being forced to come back on their country because life is getting very tough in America and Europe. There no better news in Britain either. British economy has actually shrunk in the last one year and now it is natural that many people will loss job in 2009. Perhaps the same goes for Germany which has been very badly hit because it has export based economy. Talking about export oriented economy; I feel that Japan is the worst hit as major Japanese companies have suffered too much from economic recession. I do not want to make the list bigger or talk about countries like China and Canada. You all know what is happening to them. I am going to present a business idea here for some big companies who can afford to invest a lot of money.

If you look at online form of payment, the most popular is perhaps Paypal. Paypal has become the industry standard for online payment processing. Millions of people are using it more than 100 countries. It is very successful and very popular among the consumers and traders equally. They all feel that this is a solution that has brought a lot of comfort for them. There are some other alternatives or competitors to Paypal but none of them could achieve this amount of success. I am really looking forward to Google checkout in this regard but still Paypal is the leader and it is ruling the industry.

You may wonder that it is a time of crisis and time may be not good for new business ideas. I just feel the opposite because in the time of crisis you have to come out with something new to come out of the crisis. What I understand is that Paypal is not available in many countries in the world. Take an example is my own country Bangladesh. Bangladesh has a population more than 140 million people. It is not that most people are using internet. In fact, what I understand is that only a few million people have access to internet. You may wonder whether it is a big market or not but remember that even one million population or consumer is a sizeable market. There are some other countries too with sizeable economy but are not within the rudder of Paypal. I do not understand the reason why Paypal is not eager to come to Bangladesh or whether it is Bangladesh central bank or government which is not eager to invite companies like Paypal. Here, we have some credit card facilities, internally. Now, it is possible to even get international credit card. So, the scope has been created and there is scope. However, it is yet a mystery for me that why Paypal is not here. I am not talking only about my country as I earlier mentioned that there are some other countries too and you want to know which other countries that are not covered by Paypal at this moment then you should go their official website by visiting this link.

You see that there is a sizeable market and the size of consumers’ even in the most conservative estimate should be more than hundred million. This is a big market for any company and if it can be used properly then it can be a very good business for a company. However, I do not want a new start up to try to address this market because it needs some special effort that can be managed mainly be an established and large company like Google or yahoo or in their rank. Even it can be a telecom company like Nokia who has vibrant presence in almost all the countries of the world.

Any way, my idea is that the company that wants to take advantage from this business opportunity first do your market research and hire some consultants to study the existing infrastructure, and legal frame work of those countries that are not covered by the eBay. They should talk to the government and try to come into some kind of deal. If they feel that they need to have an exclusive deal or some kind of monopoly because they are going to invest a lot of money then they should also try this way too. What is important is that they talk to the government officials and try to convince some of the countries and I am sure that if they try then some of the countries will be very happy to join the band wagon because Paypal is not too much keen to expand their operation in those countries at this moment. If it really can get a market size of 10 million then they should start it. Or in other terms, if they can approval of government of 10 or 20 countries then they should start up their operation in a serious way. At first it can not generate a lot of profit. However, what I understand is that even it can charge it some hire yet they will be able to get some money.

Japan: Record Deficit amidst Economic Recession

Everything in Japan is down today. There is less export, less import, falling share market, falling consumer confidence. The only thing perhaps is increasing is deficit. The real estate sector is suffering and there is no good news for the insurance sector too. Japan is a power house of car, consumer electronic products and machineries. The global economic slowdown means that there is less demand for these products. That is why, the country experienced  current account deficit for the first time in 13 years.

 

Reuters wrote:

The first deficit in 13 years came as the global financial crisis dried up demand for Japanese exports and, combined with a strong yen at the time, shrank the profits from overseas investments, including subsidiaries of its major manufacturers.

"The supply-demand dynamics have changed, and the current account balance indicates further yen weakness," said Kimihiko Tomita, head of foreign exchange at State Street Bank & Trust Co.

 

There is no hope for early recovery as it is a global problem not just limited to Japan. 

Will Global Economic Recession Continue in 2010 Too?

In the last few weeks, I have covered a lot about global economic recession in my blog South Asia Blog. It is clear that economic recession fast started in USA and if you want to have an end to this problem than the end to must start from the same country. Well, I do not see any hope of the economic recession ending in 2009. I feel that we will need to wait at least one year.

What I am worried is that there is no clear vision from any country about coming out of the bad time. It seems that most of them just want to find a way to tackle the bad condition but they are not working on bringing the recession to an end.

What do you think about it?