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The economy has ALWAYS been boom and bust. It's nonsensical for you to equate it with Reaganomics.
In fact, I would argue exactly the opposite point. By implementing deregulation and lower corporate taxation, bust cycles are far less severe than they were through the fifty years of Keynsian economics instituted by FDR.
Boy -- THAT is some mindless jargon.
Only real growth we have had since the advent of Reagonomics is Debt. Piles up higher and higher each year. The corporate, national, and (until the housing bust) individual asset sheets have been pretended larger and larger to make that accumulated debt be declared a "minor" issue.
Now the house of cards that was glued together with such BS is about to come tumbling down. Only path out at this point is to repudiate the debts -- such as "walk-away" home owners are doing, or massive inflation to make the dollar denominated debt appear to shrink.
Or of course, there is a third option -- real work, real products, real taxes and real balanced-to-surplus budgets. Not that is going to happen soon. What with the importance of "deregulation" and "low corporate taxes."
Well, of course, okgxnff makes very valid and key points there.
But at the risk of sounding like Professor Mircea -- I sure called things right on the post right above that.
Well, given how the growth of debt has, if anything accelerated in the past three years, I'm not sure how you can crow about being right. As a matter of fact, I would think crow is what you'd be eating right about now.
However, let's move back to the point at hand. Actually, several of my clients are beginning to move manufacturing operations back to the United States. Why? Because the relative costs of manufacturing in China have risen, while there have been some decided downsides to basing plants there.
Case in point? Furniture and other large manufactured products such as heavy machinery. Furniture manufactured in China, for example, requires a 13- to 14-week lag between initial order and delivery to retailer. And even then, the QC and damage in shipping has made satisfactory order fulfillment new to impossible. Heck, just today, Caterpillar has just announced that it is bringing a manufacturing operation back to the United States from Japan.
In fact the trend has a name: Reshoring. A hopeful trend.
Well, given how the growth of debt has, if anything accelerated in the past three years, I'm not sure how you can crow about being right. As a matter of fact, I would think crow is what you'd be eating right about now.
However, let's move back to the point at hand. Actually, several of my clients are beginning to move manufacturing operations back to the United States. Why? Because the relative costs of manufacturing in China have risen, while there have been some decided downsides to basing plants there.
Case in point? Furniture and other large manufactured products such as heavy machinery. Furniture manufactured in China, for example, requires a 13- to 14-week lag between initial order and delivery to retailer. And even then, the QC and damage in shipping has made satisfactory order fulfillment new to impossible. Heck, just today, Caterpillar has just announced that it is bringing a manufacturing operation back to the United States from Japan.
In fact the trend has a name: Reshoring. A hopeful trend.
We can only hope this trend continues. One of the reasons I think Germany has weathered the storm well is their large heavy manufacturing base. These are decent paying, highly productive and labor intensive jobs. These are GDP building jobs. You cannot grow a GDP by expecting real estate values to escalate infinitely. That is just not a sound foundation to base an economy around. The U.S. economy has been based around speculation for far too long. It's time we get back to basics again, the way our forefathers did. Honest paying jobs doing honest work making honest, high quality products.
Only issue I see is... There is no real quality guidance here in this country. Management is not equipped to run these types of operations. Manufacturing seems scary too them. So much overhead for such honest profits. Try selling that to some pie in the sky business major... There isn't money in these types of operations like there is speculating and shuffling money. When faced with this reality, they just look to offshoring to make a killing, and the cycle continues. People don't like being forced to work hard for an honest dollar, and this is why I don't expect things to change any time soon. This country has to fall into such a state of despair before the people who could really make a difference view an honest dollar as something worth working hard for.
I expect to see America largely loose it's stronghold in areas like manufacturing, and actual wealth creating sectors. It all comes down to investment. No one is willing to invest the money required to rebuild and retool these old standby industries. That means offering decent wages to high school graduates and rebuilding apprenticeship programs to rebuild the infrastructure. The worker is the greatest form of infrastructure, and look what we have done... Cut education funding, lowered expectations, basically left them to fend for themselves after graduation. How can we compete with the Germans and even the Chinese? Ask a high school graduate if they've even heard of an apprenticeship... I hope it's not too late to change things here, but we don't have enough funny money to shuffle anymore, so the only other chance for prosperity is to actually create the wealth once more. I hope we are not too far gone at this point.
Well, given how the growth of debt has, if anything accelerated in the past three years, I'm not sure how you can crow about being right. As a matter of fact, I would think crow is what you'd be eating right about now.
Now if you are talking about the national debt, much of that debt is a fiction, especially debt help by the Federal Reserve. And as has been pointed out by another member of this forum, the national debt could be paid off in quarters.
The outstanding debt of the US + bank credit loaned to private individuals is the money supply. If the national debt was not going up, we would be back into the 1930s since private debt shrinkage is destroying the money supply .All money is created as debt.
Quote:
However, let's move back to the point at hand. Actually, several of my clients are beginning to move manufacturing operations back to the United States. Why? Because the relative costs of manufacturing in China have risen, while there have been some decided downsides to basing plants there.
Case in point? Furniture and other large manufactured products such as heavy machinery. Furniture manufactured in China, for example, requires a 13- to 14-week lag between initial order and delivery to retailer. And even then, the QC and damage in shipping has made satisfactory order fulfillment new to impossible. Heck, just today, Caterpillar has just announced that it is bringing a manufacturing operation back to the United States from Japan.
In fact the trend has a name: Reshoring. A hopeful trend.
The only way that will happen is if China drives up the cost of production like we have with real estate ponzi schemes.
You can't re-shore with land rents pricing American labor out of the market.
Now if you are talking about the national debt, much of that debt is a fiction, especially debt help by the Federal Reserve. And as has been pointed out by another member of this forum, the national debt could be paid off in quarters.
The outstanding debt of the US + bank credit loaned to private individuals is the money supply. If the national debt was not going up, we would be back into the 1930s since private debt shrinkage is destroying the money supply .All money is created as debt.
The only way that will happen is if China drives up the cost of production like we have with real estate ponzi schemes.
You can't re-shore with land rents pricing American labor out of the market.
What are you talking about? It's happening right now. Several of my clients manufacture in China right now and they all agree on one thing--while Chinese currency is technically stable compared to the dollar, actual labor costs have increased roughly 30% over the past three years. And that's just the beginning.
Actually Andy Grove spoke to the higher costs of manufacturing in the United States a few weeks ago. For Intel to build a chip plant in the United States, it would cost an additional billion to do it. Yet only 10% of that amount would be in higher labor costs. The additional 90% are in the cost of more regulations, permitting, and taxation. Because government policy has had an absolute effect on the ability of manufacturers to work profitably in this country.
What are you talking about? It's happening right now. Several of my clients manufacture in China right now and they all agree on one thing--while Chinese currency is technically stable compared to the dollar, actual labor costs have increased roughly 30% over the past three years. And that's just the beginning.
Its a nice anecdote. And the only reason it will happen is like I said, equality of parasitism. Parity will be reached when China is exploited by its financial class just as much as we are. That is good news....
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Actually Andy Grove spoke to the higher costs of manufacturing in the United States a few weeks ago. For Intel to build a chip plant in the United States, it would cost an additional billion to do it. Yet only 10% of that amount would be in higher labor costs. The additional 90% are in the cost of more regulations, permitting, and taxation. Because government policy has had an absolute effect on the ability of manufacturers to work profitably in this country.
That is because American labor is efficient. However most of the income goes to finance. If China closes the productivity gap, we will be right back where we started. Why do you think the United States crushed Europe? So our best hope is the Chinese will be equally exploited.
Why do you think there are so many overnight millionaires on Wall Street? When some people point out that they can also lose big they conflate getting shot by a fellow bank robber as the risks of entrepreneurship. Hudson lays it all out nice and clear. In the end there is billionaire and no one can seem to find what he produced, just like a bank robber.
What are you talking about? It's happening right now. Several of my clients manufacture in China right now and they all agree on one thing--while Chinese currency is technically stable compared to the dollar, actual labor costs have increased roughly 30% over the past three years. And that's just the beginning.
Actually Andy Grove spoke to the higher costs of manufacturing in the United States a few weeks ago. For Intel to build a chip plant in the United States, it would cost an additional billion to do it. Yet only 10% of that amount would be in higher labor costs. The additional 90% are in the cost of more regulations, permitting, and taxation. Because government policy has had an absolute effect on the ability of manufacturers to work profitably in this country.
I don't even think labor costs are so much an issue. Doing business here is more expensive of course, but there is one important thing businesses get here that they don't get in China... Protection. Doing business in China is murky waters, because they STEAL our R&D and innovation. We've lost so many of our good ideas due to our quest to make bigger profits over there. Patent protection is meaningless there. Their government will do absolutely nothing for you, but they will protect any Chinese company selling off your work for pennies on the dollar. Try pricing in your R&D costs while Chinese companies are selling YOUR work for 50% the cost. Biggest blunder made by big business here, and it was all driven by greed. Get rid of honest paying job to make bigger bucks. Now these companies are getting theirs, and we don't have the money to afford their products!
America will slowly rebuild, but the biggest hurdle to overcome is personal debt. People just don't have the money to consume like before. Jobs will be slow to return, but they will in time. Dumb dumb dumb move on the part of business though. It was widely accepted that offshoring was the way to go to survive, and many will suffer because of it. Armchair economics at it's finest...
The economy has ALWAYS been boom and bust. It's nonsensical for you to equate it with Reaganomics.
In fact, I would argue exactly the opposite point. By implementing deregulation and lower corporate taxation, bust cycles are far less severe than they were through the fifty years of Keynsian economics instituted by FDR.
I can see that.
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