Yes, today, same with before, Alex will ask us what taught last week. And today, also, got some new students… they got a lot of reason for late enrolment. And Alex show his strict to that particular students: "Don’t skip my class…".
Last week we touch about Social Environment of the Macro Environment, today we go through the next element, economic environment.
How the economic environment actually affects our spending patterns. First, the income is changed. While the economic is bad, and it will going to bad next half year, many business and organization began to retrench workers, or reduce their salary, tend to reduce the damage of the economic on them. Somehow, less income, we will buy less. While INTI school fee higher and higher, not follows the economic trend, I think it will more difficult to us. For example, I now waiting for PTPTN to support for my school fee for this or next semester.
Inflation is defined as a general and progressive increase in prices . How inflation affects the economic environment? If inflation is getting higher, the investors will need a higher interest rate to consider lending their money to other. Last time, when the price of petrol up, everything price will up. So, our food, our rice, the egg, are rising also, so in our country, there was shortage of these all basic necessities of life.
And later Alex taught us some basic understanding about economic, so I learnt a lot. What is about the interest rate, which controlled by the government, how and why government actually do that. Somehow, we will make fixed deposit, may be in 12 months, during this range of time, we can not get out our money, but the interest rate can be higher to 3.75%, but nowadays it dropped to 3.5% and to 3.0%. But heard from Alex, the government can actually rising the interest rate, may be up to 10% to 13%, and it will let the consumer store their money in the bank, tend to reduce the money flow in the marketplace, the consumer will less buying. And when the time coming on, the government will dropping the interest rate, may be down to 2% to 1%, tend to activate the flow of money in marketplace, the consumer will buy more. The government change the interest rate is tend to manage the economic. Since the source of the fund is expensive. It is so called the monetary policy of governments . If government loosens monetary policy, it will printed a lot of money, so this makes interest rate is lower, and borrowers and lenders has more money to flow it. If the supply of money is lowered, this tightens the monetary policy and causes interest rate to rise.
And next Alex taught us about the exchange rates between the countries. Last time the exchange rate between US dollar and RM, is 1: 3.80. But somehow now it dropped to 3.20, but now rises back to 3.45.
Since these factors will actually affect our economic environment, tend to changing the consumer spending patterns.
OK, we moving to next, natural environment. First, nowadays we faced the critical problem, the problem is shortages of raw materials (e.g. oil and coal). Since the demand of that is higher, so the price will move higher. So called why we can seen the share can be up and down, I also feel strange why the price of oil can go very high and now dropped to very less, but now I still be confuse of it. The highest of the price of oil is up to US $ 180 while Malaysia announces that the price up to RM 2.70, but now it dropped to US $ 40… Another example is the price of metal, it actually priced about US $ 180 for 1 tons. But during the Olympic in China, it rises to US $ 850, can’t believe it, because China need metal to build the stadiums.. and a lot of buildings…
And second, we need energy to run all business, but now it increased the Cost of Energy, the electric fee, the water fee, all is the demand of energy in doing business even in our life. Since, the cost of energy is increased, it will cause burden to the business also.
Third, the pollution is increased, and these makes a lot of indirect affects to the business. There are a lot of pollution is Malaysia, for example, air pollution, water pollution, sound pollution, land pollution, and also global warming. The results of global warming caused Malaysia become hotter and hotter and flooding everywhere. Last year our Johor Bahru has a big flood, but I remembered last two year it is more serious, it is hard for me to back home because the big flood blocked many roads. Furthermore, the weather is changed, may be it is the punishment of the GOD to human being since the human wreck the world from the industrial age. For example, the weather of China is changed, there are flooding of snow blocked many roads to affect the people go back to Chinese New Year. And so pitiful for the polar bear. They will less the cold environment to live. Somehow they need hibernation, but it is hard for them to determine the cold time. Alex also talked us about last year he gone to Sweden(if not hear wrong), the temperature getting strange, before it will about –30 °C, but last year it raised to -5 °C, and the normal temperature changed to 5 °C to 7 °C.
Later, as an excellent story teller, Alex talked us an interesting story, why there are many disasters in the world, typhoon, floods, eruption of volcano, earthquake, thunderstorm…
The graph below showed our earth, we can see it got a north pole, and south pole, while it is a bit tilt. When come across with the north pole and south pole, our earth is spinning. When it is spinning, it generate the magnetic effect, so rising the beautiful world to us, human, animals, plants and so on.
As our human like to kill each other to get benefit, they think fighting is not enough, they also want to upgrade their scientific knowledge and level, they invent nuclear weapon. The nuclear weapon can have big disaster to our earth. For example, when the U.S.A invented a nuclear weapon, she will find a deep ground to test the nuclear bomb. When the nuclear bomb is bombed, the earth will be shaking around some time. So cause the earth need some way to balance. Come across the balancing, the earth is full of earthquake. For example, when the U.S.A. test the nuclear bomb at one place, and the other side it will earthquake soon, because the earth need to balance it…
Alex asked us about one movie, "The Core". This movie is talked about one country developed one powerful weapon, it is not nuclear weapon. Since our earth inside it got a core, spinning itself. That technology will actually drilling into the core of the earth. For example, someone hate U.S.A., it can do something about the core, made U.S.A. whole country earthquake, and later the enemies can take the time attack it… If the earth is stop spinning, it will cause the magnetic effect lose effective, the people’s brain will not determine the direction, which is north and which is south.
OK, all right, now we moved to the part of technological environment. The technology is gradually changed and it is very fast pace of changing, for the new products. Take an example, a phone. Recently, the phone, it is need spinning… but later it changed to click button way. And in the 1980′, the first mobile phone is invented, it is like a heavy box with the earphone. It is very heavy… and cost ten thousand dollars and above. Haha, it is a secret talked by Alex, his family own that mobile phone, and when the call came, they will get the call at the outside to attract the other people come, to show that they are rich enough to buy this mobile phone. Go restaurant also take this heavy thing go out… (Talk so many secret to expose to you all…) And from my memory, the mobile phone is something as the shape below.
And after a half month, it soon getting a new model of mobile phone, it seem like that… In chinese, it is called "大哥大".
It is also heavy in its size but smaller than that Alex’s family own.
He talked us one exciting thing, that is about the Nokia 8250 phone, its durability is good enough, if fell down to ground, it can use without having problem. Alex own now till today. We learnt about Nokia is actually not from Japan, IT IS FROM FINLAND.
After that, we talked about the music storage. Last time invention is a black tape. I had seen black tape before, because when I was Junior three in secondary school, my Chinese teacher is a collector of black tape, he liked to take his black tape and play the music to her. I like this teacher but now it is long time no see him. Because when I am senior level, it gone to teach at Foon Yew Kulai while I am at Foon Yew Johor Bahru.
And later, Sony first invented cassette, which to store sound, it got double side. It is quite popular for some years, and my home got this historical stuffs. It still sleep in the store room. And later, CD is invented to store many and many music while it is easy to take. And next, the MP3 is invented, the most popular is Apple Ipod. But later got something called MD, I have not heard it before, it thought like invented by Sony. But in 2006, Sony found that the most popular is MP3 and no one can afford or don’t like own a MD, so they have to produce a MP3 Player at that year. Somehow, MP3 is Korea technology… Apple Ipod is booming very fast.
For the laptop market, VAIO get the bigger market share. VAIO is stand for Visual Audio Integrated Operation, which come across with the music and video together.
The factors in the technological environment also including the high R&D budgets, R&D is stand for Research And Development. Take an example for the car, the other country car company keen to make a newer model for two years to three years, they do the research from the customer need, they document what the user like more, and make the development, a new model. But our Malaysia Shit Car Company Proton is remainly same model over 24 years protected by Malaysia. It has no any improvement on that. But one thing is very good that it is the cheapest, Malaysian can afford to buy it. Since all the imported cars, for example Honda, Toyota, Camry, the Malaysia government announced that 300% taxes on it.
Last one, we touch about political environment. In this environment, the more important element is laws. Take an example by Alex, the new law come out from Malaysia this year is every people need belts when sit at the back. So every people need to come across to buy and install the belt. So it help the business to run… Taxes stated by government also a big consideration since last paragraph last sentence we talked about the 300% taxes on imported cars, force most of the people to buy the Proton Car, while Alex also drive this Shit class. And hope he can drive safely since he drive this VERY SHIT CAR, it is dangerous than other because it is a SHIT.
The changing of government agency enforcement also a factor of affecting political environment. Since the Pakistan, even Indonesia, there are many bombing cases done by terrorist, it will leave the business man out from that particular place because it is dangerous to run the business.
Some other countries did run their socially responsible actions, for example in New Zealand, it stated a law that every supermarket need slip the price on the particular products to avoid cheating. For example in Malaysia, the seller can sell the thing with cheaper price for local but higher price for international students. Taking taxi in Nilai is a good example.
The last thing we simple going through is about responding to the marketing environment…
And now I have taken almost three hours to write this long boring story blog, so I hope you, the reader can read it, and give me some sentences of comments, to thank my finger while he is already very tired on typing on the keyboard for this three hours…
OK, tomorrow, will have more interesting part, I will record it down from the Alex’s class, and continue write on this blog, to show to you guys, hope when you are very boring, but you still can learn a piece of thing from here.
Bye, see you.
2. http://www.finpipe.com/interest.htm Interest …