Future Of The Philippines...

[FlyAway]

I can foresee China having problems in 10 to 20 years or less. They have that "1 Child" policy. Every economic model I see out there is based on growth. What happens when China's population age demographics shift?

There was an article I once read about Steve Jobs and why they manufacture in China. If you have a manufacturing change it is easy to wake up the workers living in the dorms, give them tea and biscuit, and they are off to work their 10 to 12 hour shifts 6 days a week.

Here in the US there used to be company towns for industry. How many of those are left these days? China is going through an evolution like we did. Eventually regulation will catch up. People will be sick of the smog and pollution. As stated in earlier posts, manufacturing is moving to cheaper sources of labor already. Myanmar is a prime example.

[i am bob]

Gee.... I guess nobody noticed that China has bee reducing wages? And when thee has been too much dissent over wages going down, they are packing up the entire company and moving it somewhere else where the workers aren't complaining as they haven't worked or had any money for a while? China may be a communist country but they now run it like it is a cut throat corporation.

[Beachboy]

Beachboy, how do you account for the huge trade imbalance i

haha .. I'm just an amateur .. the I only took one economics course in college and that was 45 years ago .. but I like to read. The trade deficit is there because China doesn't purchase the a lot of the goods we like to export. We run deficits with Japan and Germany for the same reason.

My point being that wealth is produced by buying and selling, not simply manufacturing. That buying and selling produces about $4 trillion yearly in the US. Chinese imports are about $400 billion a year, so a lot of money is made selling these goods.

I don't see a direct connection between Chinese purchase of Treasuries and the ability of consumers to buy Chinese goods. China doesn't have to use their surplus (about $300 bill a year) to buy Treasuries. They could buy diamond mines in Africa -- they'd get a better return if they did. China bought about 4% of the Treasuries last year. So if they don't buy, somebody else would've -- maybe at a slightly higher interest rate. And even if that happened, I think consumers would still be buying Chinese goods and US retailers would still be making money selling them.

Economists (who really know this stuff) seem to be split over whether it's harmful for the US to run large trade deficits in the long run, and whether like you suggest trade deficits enable consumer spending. Some say it will cause the sky to fall, some say it doesn't matter.. In my day (when the old Keynesians wrote the textbooks) the opinion was defects would be self-correcting in the long run. Who knows? Not me .. (I don't shop at Walmart ).

Btw .. enjoy your up coming trip to the Phils. :cheersty:

[Thomas]

So let China produce it's $2 doll and let the US companies sell it for $10. Who benefits more?

Beachboy, how do you account for the huge trade imbalance if most of the activity takes place in the United States? More dollars flow to pay Chinese based manufacturers. The money then returns to us in the form of I.O.U. notes (Treasury), which gives Americans the money to purchase more China goods.

So let China produce it's $2 doll and let the US companies sell it for $10. Who benefits more?

China gets $2 it never had. A rich US guy gets $8 from a poor US guy. What was the point again?

Exactly. JJR and Dave.

Beachboy, how do you account for the huge trade imbalance i

haha .. I'm just an amateur .. the I only took one economics course in college and that was 45 years ago .. but I like to read. The trade deficit is there because China doesn't purchase the a lot of the goods we like to export. We run deficits with Japan and Germany for the same reason.

My point being that wealth is produced by buying and selling, not simply manufacturing. That buying and selling produces about $4 trillion yearly in the US. Chinese imports are about $400 billion a year, so a lot of money is made selling these goods.

I don't see a direct connection between Chinese purchase of Treasuries and the ability of consumers to buy Chinese goods. China doesn't have to use their surplus (about $300 bill a year) to buy Treasuries. They could buy diamond mines in Africa -- they'd get a better return if they did. China bought about 4% of the Treasuries last year. So if they don't buy, somebody else would've -- maybe at a slightly higher interest rate. And even if that happened, I think consumers would still be buying Chinese goods and US retailers would still be making money selling them.

Economists (who really know this stuff) seem to be split over whether it's harmful for the US to run large trade deficits in the long run, and whether like you suggest trade deficits enable consumer spending. Some say it will cause the sky to fall, some say it doesn't matter.. In my day (when the old Keynesians wrote the textbooks) the opinion was defects would be self-correcting in the long run. Who knows? Not me .. (I don't shop at Walmart ).

Btw .. enjoy your up coming trip to the Phils. :cheersty:

Well. As the others said above. It's good for the trader, but it's bad for the country, if produce to little itself.

Easy to understand if simplifying it like this:

Asume a rich country stop produce any products (and services they can export)

and buy all from abroad.

It can go on with that a while, but finaly the country will be broke, because it don't produce any additional worth, so finaly it will be empty in the "treasure chests."

It's already a problem by unemployment cost much for rich countries.

[Thomas]

I can foresee China having problems in 10 to 20 years or less. They have that "1 Child" policy. Every economic model I see out there is based on growth. What happens when China's population age demographics shift?

Yes, and what will happen with the next gereration after that "1 child", when most 1 children are men? China will have to "import" a lot of wifes, to not get a population shrinking to almost none... :)

[Jollygoodfellow]

A member sent a couple of Emails recently more or less complaining about old topics closed, this is a prime example of why. Now can some one direct me to the Philippines forum. Maybe I read the topic title wrong?