Magic forumula for prosperity to occur: you need to work, save, then spend.
US is on the spending part. US do not produce or save enough for the spending to continue. US spending is relied totally on borrowed money. As long as they could borrow money, they could spend. It is drawing near that even borrowed money is not enough, so now US is simply printing money to spend.
WAY too many economist on the left and right, think as long as they keep the spending going, all is well. They’re wrong
We need to stop buying crap from China, even if we have to do without some stuff. Borrow that tool from your neighbor or brother-in-law. Do without new Christmas ornaments.
Quit buying Chinese merchandise!!! Make it, borrow it, do without, improvise, just quit buying anything from China unless it’s an absolute necessity. Create the demand here. It’s the best way to “stimulate” business and job growth. If there’s a demand, eventually the needed capital will follow it. Let that happen here, not in some other country.
When all things are worthless,owning America is better than owning Europe..
We’re heading toward either extreme cuts in spending (radical income and job cuts) or repudiation of government debt. We know what a sovereign debt crisis (or crises) would do to bond markets. We know what bond collapses would do to the stock markets, and consequently, to millions more jobs. Maybe the time to pay the price for centralized, global management of business is not far off. ...maybe a few months to a couple of years? We’ll see.
Mr. Chang’s last paragraph of warning and advice (page 2) is interesting. It appears that he put a bit of conscience into that.
interesting read
Its a good bet; a winning one if we can get rid of Obama and co.
Soon we’ll be importing husbands.
Ping.
How stable do you think China is? Is there a chance that it could fracture into smaller states across economic, ethnic or other lines?
Free trade simply applies this principle to nations. By allowing nations to specialize, productivity goes up, we all earn and so can consume more. Life is good.
The problem that we have with China is that we don't get the benefits of specialization because the Chinese (and our own government's deficit spending) aren't allowing the economic signals that would result in greater concentration on our respective competitive advantages to be transmitted.
The US is a powerhouse in agriculture, but the Chinese don't buy nearly enough of our pork, beef, poultry, etc., thus preventing further investment in these industries. The US is a powerhouse in R&D, yet the Chinese engage in industrial espionage on a vast scale, preventing payments for patents going to the research labs where they belong, thus sending the economic signals for the US to continue to specialize in R&D. The US is a powerhouse in aviation, yet the Chinese insist on building their own airplane industry from scratch, instead of sending economic signals in the form of money for Boeing et. al. to build more planes. The US is clearly the world leader in computer software, popular music, movies, video games and on and on, yet the Chinese pursue massive copyright theft as a matter of state policy.
The list could go on and on.
You can't have one country stealing your stuff and generally playing by mercantilist rules and call it free trade.
The US gets its own payoff here via cheap stuff at Wal-Mart, but we also pay a huge, albeit not immediately apparent, price. That is, we lose skills in manufacturing on a massive scale. Our predominance in our natural competitive advantages - most painfully, R&D - is undermined. Our artists and creative computer people are not paid and their skills atrophy.
This cheap stuff is like a drug. I'm all for free trade, but running over two hundred billion in trade deficits year after year after year ain't free trade.
It is crass mercantilism.
We need to insist that China stop stealing our IP and really throw their markets open to all of our agricultural products, airplanes, machine tools and so on. If not, then we need to cut them off until they figure out that free trade is in their interests, too.
Oh, and meantime we need to punish our pols for letting the Chicoms steal from the Chinese peasants and workers and finance our budget deficits.