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The Two Faces of China - Part I
The hard thing about China is to truly comprehend what is really happening on the growth front. Are the statistics real? But most importantly, is this sustainable? Is China a lemon or a long-term high performer?
On the one hand, China has this amazing track record of very high growth for the last 30 years. Betting against it appears foolish. On the other hand, China is still, for the most part, a command economy which after a while, you would think, would stop allocating resources efficiently. And, as I recently exposed in Governance and Prosperity (http://scepticalmarketobserver.blogspot.com/2011/07/governance-and-prosp...) and Small, Beautiful and Civilized (http://scepticalmarketobserver.blogspot.com/2011/07/small-beautiful-and-...), there are also reasons to think that the quality of governance plays an important role in sustaining growth beyond a certain threshold.
At one point, it is difficult to say when and what will happen, the economic system in China is bound to derail and make the last global financial crisis look like a small storm in comparison. Otherwise, it could be the political system that will eventually crack and change to allow for real market reform. But I don’t think that this is likely and that it will happen soon.
We have seen this fast growth dynamic being interrupted before. Africa grew very fast in the sixties following the independence movements that sweep the countries of the continents. However, as early as the mid-seventies, most of their growth came to a screeching halt due to both a lack of markets discipline and terrible governance. The lack of institutions could not sustain their development. But China is past this stage.
Japan’s and South Korea’s economies also grew very fast for a few decades in their early growth phase only to slow down to more reasonable growth rates one they had reached a certain level of GDP per capita. Today, Japan has its own problems and a declining population while South Korea is growing more or less at the rate which is expected of a developed economy. However, these two countries are market economies and more or less let the price mechanism allocate its resources.
A better comparison is probably with Russia, the mother of all command economy for 75 years. Russia grew faster than the U.S. for several decades after WWII before it reached the abyss. Indeed until the mid-sixties, Russia was growing at a brisk pace. It was competing with the U.S. in most domains including technology. However, what a command economy could achieve quickly on a mass scale in terms of allocation of resources after a disastrous war, it could not do when it came time to marginally adjust to an evolving environment and unstable market place in the following years.
And already when Soviet leader Nikita Khrushchev visited the U.S. in September 1959, signs of the decline of the Soviet Union were already apparent. Khrushchev arrived confident following the successful launch of mission to the moon by the Soviets the day before his arrival in America, only to notice that New York and other U.S. cities were booming and prosperous.
It might have been easy for Soviet planners to “decide” to create a car industry but when it came time to innovate and improve upon their technology to satisfy consumers, the plan failed. And failure grew overtime as a result of the inertia of central planners.
Without incentives and pricing mechanisms, the old Lada remained the standard well into the nineties. And it took years for customers to get a car; if you had the means and the connections. Moreover, without incentives nor competition there was no productivity improvement and no ramping up of production. The same happened to Russian TV industry: Old black and white TVs with just a few channels were still the best the Russian could produce more than thirty after they were first introduced. Why should one have thought about improving the product anyways? There was no free media, no new channels were created beside the official ones created on day 1 by the planners of the system and the content was all black and white propaganda anyways.
Eventually, it was death by a thousand cuts for the Russian economy. You could probably compete with Ladas and a black and white TV sets in the early fifties. But as the products failed to change and adapt, they fell behind and eventually looked ridiculous; especially in comparison with what existed elsewhere. The whole Russian economy was stuck in time, unable to make productivity improvements and innovate.
What appeared to have been an excellent initial allocation of resources, after the revolution and then after WWWII, when Soviet planners first identified the macro needs of the Russian economy, gradually became inadequate as the industries created remained static and unable to evolve.
Admittedly, throughout the first half of this century, it probably took a lot of foresight to imagine that progress could happen so fast if you let markets and incentives take over the responsibility of allocation resources. After all, Russia had just come out of centuries of Tsarist rules where much of the population was living in serfdom. The Industrial Revolution was still quite new in the Western world and most people did not understand nor trust the power of incentives as much as we do today. For a while, especially after the Great Depression, businessmen were still treated with suspicion.
The problem in Russia at the time was that planners were unable to read the subtle changes occurring in the economy on a daily basis; in large part because it is impossible to do without market prices. The system was unable to maintain it resources allocation prowess when it came to small incremental changes required by markets that did not exist. Without incentives and pricing mechanism, reading the tea leaves was a much more difficult task than the initial resources allocation that have been decided after WWII.
The relevant question for all of us then becomes, in a world where we recognise the power of incentives, how to we harness this power to avoid crises like the one we recently had as it is clear that the last financial is the result of incentives gone wild?
So what about China? Certainly you will say that China has adopted market economy reforms to get to where it is today. And you would certainly be right. What China did following its reforms in the late seventies was to unleash incentives allowing many Chinese citizens to innovate and prosper. However, it also remains today a command economy where the price mechanism is still mostly absent. It had only adopted half the system. The incentives are there but not much prices are being discovered to guide these incentives and reallocate resources efficiently in the long run as these prices diverge from equilibrium as they unavoidably do over time.
Whatever market prices that China conforms to are formed externally on world markets; either for the commodities China buys on world markets or for the manufacturing products it sells abroad. However, for most of everything else, domestic prices remain artificially determined. According to me, this flaw contains the seeds of China’s demise.And as I will show you tomorrow, for those who want to see, the signs already exists in plain sight.
This may not matter much for now, as long as China is still growing fast. It might still be in its early growth phase were big resource allocation decision are efficient and contribute to growth in a very significantly fashion. In this case, markets would probably be much slower at achieving the same results. This the case made by Robert Herbold in the article below. He argues that “From new roads to wise leadership, sound financials and five-year plans, Beijing has the winning approach”. Mr. Herbold is a former COO of Microsoft and is today the managing director of The Herbold Group. He is also the author of "What's Holding You Back? Ten Bold Steps That Define Gutsy Leaders" recently published.
However, the lessons of history should not be forgotten. In a few days, I will publish the darker side of the story of China’s economic development. It will be for you to decide, if China’s story will end like Cinderella or Armageddon.
Here is the piece, China vs. America: Which Is the Developing Country? (http://online.wsj.com/article/SB1000142405270230354460457643016219505708...). It was published in The Wall Street Journal recently:
“Recently I flew from Los Angeles to China to attend a corporate board-of-directors meeting in Shanghai, as well as customer and government visits there and in Beijing. After the trip was over, in thinking about the United States and China, it was not clear to me which is the developed, and which is the developing, country.
“Infrastructure: Let's face it, Los Angeles is decaying. Its airport is cramped and dirty, too small for the volume it tries to handle and in a state of disrepair. In contrast, the airports in Beijing and Shanghai are brand new, clean and incredibly spacious, with friendly, courteous staff galore. They are extremely well-designed to handle the large volume of air traffic needed to carry out global business these days.
“In traveling the highways around Los Angeles to get to the airport, you are struck by the state of disrepair there, too. Of course, everyone knows California is bankrupt and that is probably the reason why. In contrast, the infrastructure in the major Chinese cities such as Shanghai and Beijing is absolute state-of-the-art and relatively new.
“The congestion in the two cities is similar. In China, consumers are buying 18 million cars per year compared to 11 million in the U.S. China is working hard building roads to keep up with the gigantic demand for the automobile.
“The just-completed Beijing to Shanghai high-speed rail link, which takes less than five hours for the 800-mile trip, is the crown jewel of China's current 5,000 miles of rail, set to grow to 10,000 miles in 2020. Compare that to decaying Amtrak.
“Government Leadership: Here the differences are staggering. In every meeting we attended, with four different customers of our company as well as representatives from four different arms of the Chinese government, our hosts began their presentation with a brief discussion of China's new five-year-plan. This is the 12th five-year plan and it was announced in March 2011. Each of these groups reminded us that the new five-year plan is primarily focused on three things: 1) improving innovation in the country; 2) making significant improvements in the environmental footprint of China; and 3) continuing to create jobs to employ large numbers of people moving from rural to urban areas. Can you imagine the U.S. Congress and president emerging with a unified five-year plan that they actually achieve (like China typically does)?
“The specificity of China's goals in each element of the five-year plan is impressive. For example, China plans to cut carbon emissions by 17% by 2016. In the same time frame, China's high-tech industries are to grow to 15% of the economy from 3% today.
“Government Finances: This topic is, frankly, embarrassing. China manages its economy with incredible care and is sitting on trillions of dollars of reserves. In contrast, the U.S. government has managed its financials very poorly over the years and is flirting with a Greece-like catastrophe.
“Human Rights/Free Speech: In this area, our American view is that China has a ton of work to do. Their view is that we are nuts for not blocking pornography and antigovernment points-of-view from our youth and citizens.
“Technology and Innovation: To give you a feel for China's determination to become globally competitive in technology innovation, let me cite some statistics from two facilities we visited. Over the last 10 years, the Institute of Biophysics, an arm of the Chinese Academy of Science, has received very significant investment by the Chinese government. Today it consists of more than 3,000 talented scientists focused on doing world-class research in areas such as protein science, and brain and cognitive sciences.
“We also visited the new Shanghai Advanced Research Institute, another arm of the Chinese Academy of Science. This gigantic science and technology park is under construction and today consists of four buildings, but it will grow to over 60 buildings on a large piece of land equivalent to about a third of a square mile. It is being staffed by Ph.D.-caliber researchers. Their goal statement is fairly straightforward: "To be a pioneer in the development of new technologies relevant to business."
“All of the various institutes being run by the Chinese Academy of Science are going to be significantly increased in size, and staffing will be aided by a new recruiting program called "Ten Thousand Talents." This is an effort by the Chinese government to reach out to Chinese individuals who have been trained, and currently reside, outside China. They are focusing on those who are world-class in their technical abilities, primarily at the Ph.D. level, at work in various universities and science institutes abroad. In each year of this new five-year plan, the goal is to recruit 2,000 of these individuals to return to China.
“Reasons and Cure: Given all of the above, I think you can see why I pose the fundamental question: Which is the developing country and which is the developed country? The next questions are: Why is this occurring and what should the U.S. do?
“Let's face it—we are getting beaten because the U.S. government can't seem to make big improvements. Issues quickly get polarized, and then further polarized by the media, which needs extreme viewpoints to draw attention and increase audience size. The autocratic Chinese leadership gets things done fast (currently the autocrats seem to be highly effective).
"What is the cure? Washington politicians and American voters need to snap to and realize they are getting beaten—and make big changes that put the U.S. back on track: Fix the budget and the burden of entitlements; implement an aggressive five-year debt-reduction plan, and start approving some winning plans. Wake up, America!”
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China has the "ideal" poiitical model of tomorrow's world : world centralised governance and world oligarchy play, hand in hand. No market, no free media, just public opinion controlled through censoring and media propaganda; then repressive damage control to weed out the protestors; branded as heretics in mock trials and put behind bars.
That's where the world is heading towards in the name of normalcy bias and price/supply stability in a resource hungry world of 7 billion poverty striken sheeple plus 0.5 billion ruling class. And the sad part of this is that its the US oligarchy's careening folly into irrational exuberance, fed on "we can't lose" NWO hubris, that has brought this about; while the general western public sank into Internet fed and now Apple iphoned apathy and hyper consumer comfy virtuality; mass media fed, sanitised, anaesthetised denial of reality.
“Human Rights/Free Speech: In this area, our American view is that China has a ton of work to do. Their view is that we are nuts for not blocking pornography and antigovernment points-of-view from our youth and citizens.
Without tolerance of opposing viewpoints, the system is doomed,
China will slow and crumble in the long run due to one very simple fact that is being overlooked, there is not enough resorces to support the growth they require in the entire world, combine this fact with India, Russia, and China all competing for the same stuff and you see the clouds of war again, history repeats on and on and on. The chinese are forming the same doctrine the Japanese did before WW II and for the same reasons, China needs the raw materials to feed thier beast of consumption.The australians and new zealanders, and the phillipines do not like the increasing naval presence of china, not to mention Japan, also the South Koreans do not like Japan recovering too quickly as this fact will hurt their exports. The circle of repeatable and predictable events go on and on and on. Every 20 years a major war. Iraq and Afghanistan are not major wars sorry to say.
Luc, buddy, get a fucking clue! You wrote all of this based on this silly question?
"But most importantly, is this sustainable?"
No. And FUCK NO!
Take a look at imports and exports. What is China importing? Finished goods? Ah, no. They're importing raw natural resources, and these, for those who have been fucking asleep, ARE RAPIDLY DEPLETING! The energy isn't there to both maintain insane growth levels in China's production OR in keeping most of the Western world in a lavish lifestyle, let alone BOTH!
It's like this, the harder China pushes on the gas pedal the more exhaust is spewed into the car. And the driver(s) with their foot on the pedal will start to become asphyxiated, causing them to slump and remove tension from the pedal. IF they should "recover" to stuff the pedal again it'll only do the same thing, until, that is, there's brain death.
Although I speak allegorically, it's not far off from the literal: http://www.chinahush.com/2009/10/21/amazing-pictures-pollution-in-china/
Perpetual growth on a finite planet ISN'T possible! Trying to dodge this via stupid economics discussions is, at best, infantile. (and all other debates [such as our dicks are bigger than theirs (our manufacturing blah, blah... we're NUMBER 1!)] are mere distractions)
China knows about this problem very well. That's why China heavily invest in renewable energy such as wind farm and solar power. China was the world leader of the investment in this area in 2010.
http://www.unep.org/newscentre/default.aspx?DocumentID=2647&ArticleID=8805
Like the article said, what US has been doing?? Its citizens are even still using old high energy consumption light blub.
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It might have been easy for Soviet planners to “decide” to create a car industry but when it came time to innovate and improve upon their
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that true, only RUSSIAN didnt even create car industry..
lada was original car of FIAT, ITALIAN carmaker.. russians bought whole industry from italians..
bascially, whole heavy russian industry is mostly is theft.. space program/ nuclear bombs/ car industry/etce/etc
, yes, sometimes russian bought some technologies..
funny, after lada became russian car, quility went down instantly.. , so russians in 60x-70x were still trying to buy original italian parts cause there were much better..
alx
The Lada was essentially the Fiat 124 after Fiat was phasing it out. Top Gear with Clarkson and May tested a commie Lada versus a commie British Leyland which was govt owned in the 1970s.
Commies make bad cars - see GM/Chryslers beer swilling and pot smoking UAW thugs.
This makes it sound like we are getting beaten by China doing things better. That is bull shit, the only thing China has going for it is cheap labor. And the labor is cheap because the Government has been so inept or corrupt for generations, maybe even 1000 or more years, that the country is poor and filled with peasants, and we cannot compete with them, that is all there is to it. As far as I can see, other than some electronics, most Chinese goods are crap, they are not durable and don't work as intended. because of that we need to buy the same stuff over and over and are poorer because of that.
US and multinational corporates have taught China how to make the best of stuff and the worst of stuff. Most importantly, they've taught China to make exactly what the west will buy. If you complain about cheap breakable crap from China, you have to realise that they are merely building to WalMart provided spec.
+1 Perfectly true. The biggest exports from China are not from local firms, but joint ventures with US/EU partners.
Reading through all the hate-filled, breast beating diatribes almost daily about China takes me back to my childhood. I'm old enough to remember scenes of American auto workers smashing imported Toyotas with baseball bats, and all the remarks about the copy-cat Japs, unimaginative, uninventive nips taking our jobs....... Nothing much changes does it?
As with most countries, the people in China are great, but it's their political system that sucks. Lots and lots of what you see in China is a facade done for show. Let's count the frauds...
The Chinese cannot clean or repair. These toys built for the Olympic show will turn to shit in a few years because nobody will repair and maintain them. If their airports are big and spacious, one must ask about the potential for over-capacity built by centrally planned machinery on auto pilot. In my experience private owners and managers take much better care of their property and are much more careful about how much they build.
The flashing strips of decorative LEDs will be the first to die. They will live about as long as the 1950's era electric ice-melters for the on-ramps of Boston's former elevated highway. The aluminium wires in their PVC conduits rotting in the sunlight will go shortly thereafter. The quality of their craftsmanship is abysmal. Come back in five years and tell me what the pavement looks like. Again, private owners take better care of their property.
Their infrastructure is completely unprepared for an influx of cars. It's great to build lots of new highways, but the custom of parking (and driving) on city sidewalks is not going to scale well. Everything to do with parking is deficient to say the least.
Central planning machinery on autopilot. The customers of the trains will never cover their construction and operating costs. Do the math. 800 mile trip, 5 hours, 160 miles per hour. That's no toooooo bad, but I expect more for "high-speed" rail. And that's the average speed. The top speed is reserved for certain segments, presumably ones in best repair. The rest of the ride is slower. Why? Recall the recent high-speed train accident. The authorities quickly buried the fucking train! Why? What are they hiding? Private sector operators would never build this, and if they did, it would be maintained and lot safer. You can bet Dagny T would never have the luxury or ethics required to bury the train after an accident.
This the best element of lala land in this article. At first glimpse, the government officials indeed are mostly smiling and cooperative. However, these "plans" are shit and the only way they will be accomplished is via political trickery and fraudulent accounting. I shudder to think of the effect of the DC gang of 535 + 1 goosestepping in unison and thank God everyday that they are on the verge of mutual annihilation instead lest we-the-people become obligated to do the dirty work ourselves. But I digress...
But just like a shrew wife that converts from fun girlfriend to SheDevil after you get hooked, these officials are all yes, yes, yes in the beginning. Later on, you will find an endless stream of additional requirements from other b-crats that somehow get involved. Let's face it b-cracy sucks on either side of the lake.
Wow! That's really great. They must have lots of good assholes to pull these numbers out of. Why not cut C by 100% by tomorrow and make the entire economy high tech? Let's just cut to the chase and make everybody rich and happy NOW. Problem solved. Next?
What suckers offered such endless credit to their biggest customer of questionable ethics and finances? Which government funds their local governments via real-estate bubble speculation? How do you expect that to play out? The only reason their system lives today is that it hasn't died with the rest of the Ponziverse. Yet.
This is getting closer to the core of the Chinese problem. Censoring the media is only the tip of the iceberg of controlling what people think. The children are all pushed to do nothing but schoolwork. Upon initial examination this looks good. Most of these good school kids will avoid the juvenile delinquent stage of their lives and go straight into the productive and good citizen stage. What is not so obvious is that the same kids who never discover bongs or shrooms also never discover Asimov, Rand, or Heinlein. None of them would dream of neglecting their schoolwork in order to work on their private pursuits of mad science. They don't have hobbies or interests and do not read. The only thing they say when you question them about this is that their only path to a "good job" is to study, study, study whatever rote-propaganda is fed to them.
The teenagers are indeed mostly pleasant and well behaved. And that's certainly a breath of fresh air. But from where springs the creativity and disent required to do business? This is the essence of their problem. Like a rich-kid whose daddy buys him a restaurant.... He can pretend he's a "businessman" because he copies and buys things. But he does not have the warrior spirit in his heart and will be annihilated upon first contact with the real market.
Hahaha. A show piece. Were these the hackers putting together their own bio labs in their basement as teenagers? No, these are the people who only study, study, study and who float to the top of the exam results and degree accumulation ranking. Instant mess of experts. Which one is the contrarian who thinks for himself?
What insight into business do scientific academics have?
Tell me again? What insight into business do scientific academics have? Why 2000? How did they calculate that number? Or do central planners pull better round numbers out of their asses then business people can calculate?
Easy. USA 1. China 0. America has a dsyfunctional government cancered on top of an ocean of people with the capacity (presently unused) for creative and critical thinking. The Chinese are missing the creative and critical thinking part. It's like the difference between faking an orgasm or doing it for real. China is too busy shouting "oh oh oh! Ride me Cowboy!" and would have no idea what just happened when and if the real thing ever occurs.
The US should disband about 95% of the Federal Government. Get it out of the money, banking, finance, health, education, global conquest, retirement scams, insurance, and energy businesses. Return the usurped power to the States and we-the-people. Take our lumps and let the existing system fail and birth a new one. Return the Fed to its role of guarantor of national defense and civil order. Cross our fingers and hope for the best and hope God has mercy on our souls.
We are getting beaten because .gov is incapable of doing the right thing, which is to fuck off and leave us alone. The only thing the Chinese know better than US is how to present their fraud to gullible people. Now that's a lesson the criminals in DC desperatly want to learn!
2 questions, 1 remark...
a) How many Nobel prize winners smoked weed and ate mushrooms in their teens ? Science is done by first learning (and some kind of humility), and then by creating something new based on reflexions on what was learned. Drop the first part and you have bozos instead of scientists.
b) If you want to base the prosperity of the US on a few out-of-the-crowd wizz kids, why do you complain that 30 years later they are self-serving moguls who don't have any empathy with the common citizens ?
The problem with the US is that since Reagan they changed from a nation to a set of individuals focused on their own interests. This is the essence of the downgrade by S&P: citizens will prefer their own short-term interests rather than a collective effort to pay the nation's debt.
on Mon, 08/08/2011 - 03:21
#1536128
2 questions, 1 remark...
a) How many Nobel prize winners smoked weed and ate mushrooms in their teens ? Science is done by first learning (and some kind of humility), and then by creating something new based on reflexions on what was learned. Drop the first part and you have bozos instead of scientists.
b) If you want to base the prosperity of the US on a few out-of-the-crowd wizz kids, why do you complain that 30 years later they are self-serving moguls who don't have any empathy with the common citizens ?
The problem with the US is that since Reagan they changed from a nation to a set of individuals focused on their own interests. This is the essence of the downgrade by S&P: citizens will prefer their own short-term interests rather than a collective effort to pay the nation's debt.
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You just bought yourself a seat on the boat! and its standing room only! and you still got a seat!
Fantastic!
Please Preach and Spread the Word of Truth to "We the People" as often as possible! The People Need You! Desperately!!
Proofreading is so overrated.
Once again!
China 1,200% Leverage before the ink dries on the notes.
United States 120% Leverage before the ink dries on the notes.
Just becuase China can service their 1,200% Debt Building Cities that NO ONE LIVES IN! does not mean they are a Tangible Threat.
Who cares what China thinks or says!
China is MORE Fake than the United States! by a 1,000 Fucking %!
A problem I don't think china can resolve:
Innovation always has an aspect of rebellion against the current accepted status.
China has a strict hierarchy without the ability to question the existing dogma.
This will stifle their science and innovation.
U.S. Nobel prizes in science: around 200.
China's Nobel prizes in science, zero or one depending on if you count Hong Kong as part of China? Even that one was by a gentleman educated in London.
All of Asia has fewer than 20 science Nobels.
Nobel Prizes in science are a seriously lagging indicator. They often acknowledge groundbreaking work which was done 10 or 15 years ago. Saying that the US has collected all those Nobel Prizes for science is to indeed note the great scientific achievements of American history.
China will never fall behind the west when it comes to corporate R&D because they will just hack into corporate computer networks and take whatever they lack.
In terms of misallocation of capital, you don't have to look very far to see this in action. I travel quite a bit and it amazes me how many luxury hotels are being built in China. Can they support 10 St. Regis resorts? Probably not.
I agree they probably won't be able to support those hotels. Mind you...100M upper middle class consumers is a lot of spending power.
China, the country that Sam Walton and Jack Welch built.
They still make crap, and wherever possible they try to hide the "made in China" tag.
American corporations, readily prepared to sell their children at the right price.
+1
this COO guy is an idiot. He loves China because government pours money into the pockets of people like him. Fucking 5-year plans from government, wtf. As if idiots in government who get there because of connections are the reason for economic success
6 x 5 year plans of consistent economic growth, each year of growth sucking wealth and technology out of the USA. Do you have a problem with that. Seemed to work didn't it.
BTW Koo is with Nomura. You can trust that the Chinese aren't gifting any excess money to a Japanese bank. WWII and long memories you know.
Nationalism is just another tool in the PTB chest. Patriotism the last refuge of scoundrels... Religion - put your faith in god - never mind the present.
Let's see: "All of you middle class people - things would be better if we could just get rid of those damned unions - they are unreasonable and are destroying our competitiveness. We should also cut the unemployed off of benefits - they are just eaters anyhow. How about those poor people - sucking up resources and living the high life! Lets get rid of them too. The old - they no longer have a value to society - they use all of our medical resources. On and on we go...
It is of course just vaguely possible that the oligarchs are playing one class/faith/nation off of each other in order to maximize their own power/wealth isn't it?
China is great for oligarchs. That's all you need to know. Far more fertile slave class to strip mine.
No laws against dumping toxic shit in the water...it's a COO's wet dream. Maximum profit and you can always count on the French to keep their environmental laws so you can escape there to live.
If someone complains, the government steps on them to preserve the business class. Everything is accomplished by bribes and corruption and the government operates with impunity. If thousands die or a building falls over, or half the nation gets cancer, the government stands ready with tanks and propaganda advising the people "not to make trouble" for their leaders, lest those leaders "lose face." It may as well be ancient feudalism. The Chinese middle class exists as a propaganda tool, nothing more.
Trav, good post.
Lest we 4get fox-con...
Boom boom boom...
Gloom gloom gloom, jump jump jump to death.
Doom doom doom, click click click, robo-ticks.
Some plan (hail to the oli-masters), some growth, some middle class.
Thanks for sharing.
A national tool importer has been replacing China made products with equivalent "made in Taiwan". The issue (they tell me at the store) is quality. just saying
China's national policy is to steal anything they can. They have no concept of western culture of cooperative business. Their plan is to exploit and make the 5 year plan by any means possible. If this costs them customers in the long run, who cares? They have the same mentality as western executives. Make as much money as possible for ME NOW and fuck the world.
Fuck the people, fuck the air, water, land...everything.
As long a the banks and Rockefellers own the politicians only wrong decisions will be made and one world governance will be pushed as the elites see to it that the wrong decision are made by thier political puppets so that they can take over the world. The American people must stand up and throw out the elites.
Herbold's article linked to above, 'China vs. America: Which Is the Developing Country?' ~ absolutely spot on. The thing that stands out in my travels there: the Chinese people are friendly, peaceful and confident... signs of a society on the rise. Oh, and they definitely know how to have a good time:
http://chinapositive.blogspot.com/2011/01/changsha-every-nightlife.html
AND / Tiananmen Square /< Repressed?
duplicate
LV is spot on noticing the ratty state of Los Angeles freeways. The buffer zones are full of trash and weeds.
Maybe someone could employ a few of those millions of American unemployed to clean them up? I mean...that would be a win/win, right?
China is facing decades of prosperity, with minor bumps along the way.
The USA is facing economic catastrophe, a shitstorm of ruin unrivaled in this country's 200+ year history.
ROTFL...sorry, man, not the oil supply to make that a reality. Nowhere even close.
China is prosperous for oligarchs, which is how the western business class wants it. Think about it, they could run over a peasant in their Mercedes in china and do it with impunity, just like the nobles of old wouldn't slow their carriage an iota if a peasant kid was in the street. They'd just run them over.
"China is prosperous for oligarchs, which is how the western business class wants it."
You're speaking as if the "western business class" is in control of the Chinese economy. Seems to me that might be a bit ambitious because the western business class appears to be having some trouble even controlling their own economies.
Speaking of minor bumps along the way-
We should propagandize the Chinese. Get them all into labor unions.
Promises of middle-classhood dancing before their eyes.
As they demand vacations, overtime pay and benefits, the west will become a bit more competitive with them.
Or we could just nuke the living shit out of them, but that's not nice.
No need to nuke the shit out of them. Encourage their brighest to go to LAW school rather than engineering school. Then the brightest lawyers can go their "wall street", and their productive folks will be suitably fucked. Just like we are.
No, no, no. Have their brightest go to engineering school and then have them work to create HFT algorithms. There are plenty of arbitrage opportunities in their nascent market.
It is hard to build a lasting, successful economy based on cheap products and NO BRANDS........the whole world is complaining that cheap chinese imports are destroying their economies......from Saudi Arabia to New Zealand to Zimbabwe.............
check out these headlines.......
http://nakedempire2.blogspot.com/search/label/cheap%20chinese%20imports
No brands? You mean Apple? Thinkpad? China does have factories for high end goods.
The funny thing is China is not cheap enough for some companies anymore so they move their factories to South Asia.
It's not the US government, it's corporate US which made a free technology transfer to China...No way to recover from this blunder.
THE FORMER PRESIDENT OF THE WORLD BANK, JAMES WOLFENSOHN Explains how Americas Production / Manufacturing has been and is continuing to be cut into pieces and moved off shore. This is very much worth your time, if you are from the West or planning on living in the West.
http://www.youtube.com/watch?v=mOwZwkhFemQ
America was sold off to the World.
***** “Over the last ten years, China has mounted the biggest challenge to the U.S. manufacturing sector ever seen, threatening producers of steel, chemicals, glass, paper, drugs and any number of other items with prices they cannot match. Not coincidentally, the United States has lost an average of 50,000 manufacturing jobs every month during the same period.” *****
http://blogs.forbes.com/beltway/2011/02/14/intelligence-community-fears-u-s-manufacturing-decline/
The United States has shipped over 7 Million Manufacturing Jobs to China in the last 11 years.. along with those 7 Million Manufacturing Jobs the Tax Base that those 7 Million Manufacturing Jobs Represent. If you look at a 25% tax bracket for $50,000 dollar average pay.. over 10 years.. works out to $7 Trillion Dollars or Half our National Debt.
I don't know whether this still holds true, but years ago I was told that the majority of the Chinese politburo members had their grounding in either science or engineering. The Maoists are outnumbered by the technocrats - if Bill Gates ran a country, it would probably be run by the nerds of the Chinese politburo. I think we'll have to wait until they start electing lawyers into positions of power before we see them collapse.
http://www.time.com/time/world/article/0,8599,165453,00.html