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  • #16
    Proof, Andrew, bring proof. A newspaper article, a graph, a chart, something.

    Unfounded claim are just that
    Meddle not in the affairs of dragons, for you are crunchy and taste good with ketchup.

    Abusing Yellow is meant to be a labor of love, not something you sell to the highest bidder.

    Comment


    • #17
      Originally posted by bigross86 View Post
      Proof, Andrew, bring proof. A newspaper article, a graph, a chart, something.

      Unfounded claim are just that
      He stayed at a Holiday Inn Express last night . . .

      "So little pains do the vulgar take in the investigation of truth, accepting readily the first story that comes to hand." Thucydides 1.20.3

      Comment


      • #18
        Originally posted by bigross86 View Post
        Proof, Andrew, bring proof. A newspaper article, a graph, a chart, something.

        Unfounded claim are just that
        Does a Fox News report written by some prejudged dumb-ass prove anything?
        We are talking about future possibilities.
        It's an issue of personal perceptions by definition.

        Comment


        • #19
          It does if the news report is based on some sort of facts or factual assumptions, like Fox News, and most news agencies are.

          Your opinion is nice, and future possibilities are great, but here on WAB we discuss possibilities that can actually happen. I can discuss what will happen when Elvis and JFK come back off that desert island they're hiding on, but thatd be plain crap.

          Personal perceptions aren't worth much without basis. I can perceive that 1+1=3. Does it? NO
          Meddle not in the affairs of dragons, for you are crunchy and taste good with ketchup.

          Abusing Yellow is meant to be a labor of love, not something you sell to the highest bidder.

          Comment


          • #20
            Originally posted by Shek View Post
            Wages in China are under tremedous pressure and some manufacturing will shift offshore. Both of these will serve to dampen growth rates.

            FT.com / Asia-Pacific - Rising Chinese wages pose relocation risk
            Chinese wages and the turning point in the Chinese economy | East Asia Forum
            http://www.nytimes.com/2010/06/08/bu...l/08wages.html
            Sir,

            Regarding China, I wanted to point out that a recent move by Foxconn roughly less than a year ago to boost wages dramatically and quickly I might add in light of the suicides suggest that their profit margins are high and they aren't battling tooth and nail like American firms are for every percentage point.

            Also, I see the impressive infrastructure investments made by the Chinese government into the interior of China, I believe that investment will lead to the Chinese interior being a more attractive choice to move manufacturing processes than moving it to a nearby country like Bangladesh.

            Of course, all this just means the shift and dampening of growth will happen later than predicted, but it will happen as you say.

            Originally posted by Shek View Post
            China has a whole host of issues to solve - the 4-2-1 demographic problem, the banking sector, piracy laws, and quality control issues, all of which will serve to make their entry into higher level markets difficult. If someone has a choice to import Chinese goods vs. South Korean or Taiwanese goods at similar price points, I doubt that many will choose China over SK or TWN. Very few folks will want to offshore their higher intellectual property processes to China because of piracy issues. Also, demographic isses and banking issues will soak up private dollars into public safety nets to dampen political unrest that might otherwise follow - this will dampen growth in internal Chinese markets.

            China's at the tail end of the beginning stage of their catch up growth and have all the above factors above that will serve to further dampen growth rates that would already dampen naturally based on economic growth theory.
            Sir, I also want to make a specific comment on intellectual property rights as well as safety nets since I do not know enough about the Chinese banking sector or the quality control sectors to say anything. That is, intellectual property rights is up in the air for the future, but I watched a recent video posted by this forum actually on Jon Huntsman and he described a emerging intellectual class of creators that will eventually address such property rights issues or at the very least pressure the government. I am inclined to believe that mainly because the class he describes tend to include powerful businesspeople and influential artists that have a stake in protecting their creations that make money.

            Also, I don't believe the safety nets will be that much of a difficulty for the Chinese government as compared to Western governments if only because of the tradition filial piety where you rely on your kids for your retirement. A large portion of Chinese friends of mine have their grandparents living with them.


            Of course, I'm no expert and what I said is an opinion, not fact.
            Everybody sing this song, DooDah, DooDah

            Comment


            • #21
              Originally posted by andrew View Post
              Right now, China is moving to the next stage of economic development, from a model based on cheap labor and production of junk or assembling foreign-designed products to a model based on indigenous innovations and production of higher value-added products.
              As for the issues you list above, all developing countries have their own problems. Some countries overcome them, others don't.
              Yes, it's a big challenge for China. But I expect a much brighter future for that nation than most doom-sayers in the West.
              Sir,

              I'm reminded of this particular article from The Economist.


              Extrapolating, Thomson Reuters concludes that China will become the world’s largest publisher of patents next year. Straight-line projections are not always reliable. But Dave Brown, president of the intellectual-property division at Thomson Reuters, says he is confident that this is indeed the way things are going. If China becomes the world’s top patent-generator, the world’s press will go wild.

              Yet there are reasons for scepticism. The bureaucrats in Chinese patent offices are paid more if they approve more patents, say local lawyers. That must tempt them to say yes to ideas of dubious originality. And the generosity of China’s incentives for patent-filing may make it worthwhile for companies and individuals to patent even worthless ideas. “Patents are easy to file,” says Tony Chen, a patent attorney with Jones Day in Shanghai, “but gems are hard to find in a mountain of junk.”
              Everybody sing this song, DooDah, DooDah

              Comment


              • #22
                Random Reader,

                China is facing the Lewis Turning Point. Their pool of untapped labor is small and their working age population has essentially peaked. The problem with the 4-2-1 problem is that it's a couple with kids trying to care for 4 parents and 8 grandparents, minus whoever's already passed on. Wages will have to grow quite a bit to be able to dampen for calls for the state to assist with a safety net.

                For more, here's a quick read: http://www.un.org/esa/population/mee...FWang_text.pdf

                Here's another thread that looks specifically at 4-2-1, although it's a few years old.

                http://www.worldaffairsboard.com/sta...1-problem.html
                "So little pains do the vulgar take in the investigation of truth, accepting readily the first story that comes to hand." Thucydides 1.20.3

                Comment


                • #23
                  Originally posted by Shek View Post
                  Random Reader,

                  China is facing the Lewis Turning Point. Their pool of untapped labor is small and their working age population has essentially peaked. The problem with the 4-2-1 problem is that it's a couple with kids trying to care for 4 parents and 8 grandparents, minus whoever's already passed on. Wages will have to grow quite a bit to be able to dampen for calls for the state to assist with a safety net.

                  For more, here's a quick read: http://www.un.org/esa/population/mee...FWang_text.pdf

                  Here's another thread that looks specifically at 4-2-1, although it's a few years old.

                  http://www.worldaffairsboard.com/sta...1-problem.html
                  Sir,

                  Thanks for the reads. I'll take your word for the Lewis Turning Point.

                  I do believe I got a tiny bit smarter. LOLs.

                  But the only problem I have with the 4-2-1 problem leading to more safety nets is that the richer tend to live longer than the poor and the failure to differentiate between the life expectancy of the relatively rich Chinese and the relatively poor Chinese by the links though there was a mention of a difference in life expectancy among rural and urban Chinese in the paper by Mr. Wang you linked. China's life expectancy seems to be only a bit above retirement age and it seems to me that a significant portion of the poor won't actually reach the age of retirement. And the idea of safety nets for the relatively wealthy rich in China when there are still poor peasants around doesn't sound like a popular idea.

                  Of course, once again, I'm no expert and this is a logical guess with no empirical evidence unfortunately....
                  Everybody sing this song, DooDah, DooDah

                  Comment


                  • #24
                    Jumping in, as advised.

                    I’m largely with Andrew here – China’s changing, and the cost of production is rising, quickly. However, the investment and infrastructure already in place are extremely difficult to duplicate, quickly, in Bangladesh, Vietnam, Columbia or Egypt. So, too, is the trust with which business invests its money, and the soft institutions such as banking and insurance. None of them are perfect, but they are there, and they are known.
                    Duplication is more expensive than an extra $1/hour.

                    As for proof, I generally discount most journalistic economic analysis. Just as the military veterans here would not fully and quickly accept a 24-hour TV journalist's understanding of the pros and cons of this weapons system vs. that one, neither should the TV talking heads ranting about economics or markets be considered more than mere entertainment.

                    (Who was that loud mouth in the US that demanded everyone buy Bear Stearns, just before it collapsed? Jon Stewart did a number on him that said it all.)

                    As for Foxconn, that is a perfect example of how journalists get it so wrong. When the stories first broke, my immediate reaction was to look up the national average number of suicides per million. After adjusting for the number of months during which 17 Foxconn employees took their own lives, and the total population of Foxconn's factories, I realized that the ratio was less than two-thirds the national average. In other words, it was a non-story dressed up with bad statistics.
                    Trust me?
                    I'm an economist!

                    Comment


                    • #25
                      Originally posted by Shek View Post
                      Random Reader,

                      China is facing the Lewis Turning Point. Their pool of untapped labor is small and their working age population has essentially peaked. The problem with the 4-2-1 problem is that it's a couple with kids trying to care for 4 parents and 8 grandparents, minus whoever's already passed on. Wages will have to grow quite a bit to be able to dampen for calls for the state to assist with a safety net.

                      For more, here's a quick read: http://www.un.org/esa/population/mee...FWang_text.pdf

                      Here's another thread that looks specifically at 4-2-1, although it's a few years old.

                      http://www.worldaffairsboard.com/sta...1-problem.html
                      Bump.

                      I just wanted to mention it appears you are right.

                      Central-government spending on education, health care and social security is to increase by more than 16%, and on subsidised housing by more than a third
                      China's security state: The truncheon budget | The Economist

                      And on a personal note, I gotta diversify my sources more instead of relying on The Economist too much. Bleh.
                      Everybody sing this song, DooDah, DooDah

                      Comment


                      • #26
                        Originally posted by random_reader View Post
                        China's security state: The truncheon budget | The Economist

                        And on a personal note, I gotta diversify my sources more instead of relying on The Economist too much. Bleh.
                        Here are two related reads:

                        Book Review: Red Capitalism - WSJ.com
                        FT.com / China - China noses ahead as top goods producer

                        The FT one is gated, but free.
                        "So little pains do the vulgar take in the investigation of truth, accepting readily the first story that comes to hand." Thucydides 1.20.3

                        Comment


                        • #27
                          TWO trends are making it hard for the American workforce, not just one.

                          First and foremost is production efficiencies --these make workers redundant

                          Secondly, FREE TRADE is NOT free. It ALSO has eliminated (my SWAG*) 30,000,000 jobs in the USA.

                          SWAG = Scientific Wild-Assed Guess

                          Comment


                          • #28
                            Originally posted by editec View Post
                            TWO trends are making it hard for the American workforce, not just one.

                            First and foremost is production efficiencies --these make workers redundant
                            Err.. so you want to basically handicap companies into retaining workers and affecting profits WHICH will be pumped not only back into business, but into the economy? Corporations handle their profits better than individuals handle theirs...

                            Also, this means that said company forced to become relatively unefficient is suffering a loss against other foreign companies who can lay off workers and improve efficiency.

                            Secondly, FREE TRADE is NOT free.
                            You're making some pretty big claims. How so? Instead of providing some generalized one liners, perhaps a contention supporting why?

                            It ALSO has eliminated (my SWAG*) 30,000,000 jobs in the USA.


                            SWAG = Scientific Wild-Assed Guess
                            I'm just going to disregard this.
                            "Who says organization, says oligarchy"

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