Thursday, July 16, 2009

EconNews Roundup

Thoughtful piece from Daily News editorial on education and schooling. I would agree with almost everything in the article, but much of Turkey is still in the industrial world. As the principal author for a World Bank report on higher education and the labor market in Turkey, I can attest that the Turkish higher education system is not faring well (except very notable exceptions such as the Eskisehir universities and Cappodocia Vocational School) in terms of preparing students to this industrial world. Even worse still, most universities feel very strongly that that is not their objective at all.

Speaking of these reports, the team that did all the interviews did a tremendous effort, so my part, analysis and writing, was a piece of cake. But I feel all that fell on deaf ears. Even the person in charge of the project summarized the findings as businesses asking for computer and English skills in a recent column he wrote.

Coming to other stuff, Daily News reports on yesterday's data, i.e. unemployment and the budget. The article is to-the-point and correct, but I found the title unfortunate: As is noted in the article as well, the monthly drop is solely seasonal; on a yoy basis, unemployment is actually continuing to rise. That's what I've done in the graph below:

There are more scientific methods for weeding out seasonality, but this is by far the easiest one, and it delivers the message: The employment drought is continuing. As a side point, statistics such as these are usually ignored, even when in the US, where the data is delivered in a much more timely response, simply because unemployment is a lagging indicator. I would mostly agree, but I have begun to think in some instances, it could be a leading indicator as well. I'll come back to this, maybe in the Hurriyet column.

Last but definitely not the least, the irresistible fall of capital flows. Note that, as I have mentioned earlier, portfolio flows have picked up in May, as risk aversion subsided, and preliminary data hint that the trend continued in June.

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