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He is buying Chinese made fence staples because there are no longer any American made fence staples to be purchased. They aren't made any more.
I have to drive 120 miles in each direction to buy American made fence wire, and can't get American made rabbit wire any where in the state. I used to drive 50 miles each way to buy American made screws and nails, but that store no longer carries them because they can't find them to buy. So sometimes, there is no alternative to buying Chinese.
To top it off, the Supreme Court has ruled that if it is assembled in the USA out of foreign made parts, it can be labeled as "Made in America", so even buying "Made in America" will not save you from dysfunctional metal.
USA made steel was the best in the world. Are there even any foundries left in the USA?
To be clear, if it's labeled "Made in USA" it must be 80% either a)sourced, b) manufactured or c)assembled in the USA. That is the law.
Don't blame the Chinese. They're not the ones raking it in from their cheap merchandise. It is the US multinationals who contract the manufacturing there then sell the stuff here who accrue the lion's share of the profits. In any case, China won't dare foreclose: as long as YOU keep buying.
Which is the reason I voted for Ross Perot and Pat Buchanan
So what's your point? Even on the high-end stuff they make, look who gets the money--US multinationals.
Quote:
Originally Posted by chuckmann
Hmmmm... Iphones, Ipads, Ipods are cheap junk? How about all that high end data communications equipment that is supplying some major percentage of the US telecom infrastructure? Not to mention all them Android smartphones I see in the wireless stores these days?
The Chinese are peaking. They have been cooking the economic books for years, so much so that nobody really knows what their actual economic numbers. They are also facing a demographic crisis. For the next couple of years, China will have the highest working-age population that it ever will, and the numbers then fall off the cliff. Finally, China is a classic commodity economy based on cheap labor. Only the cheap labor isn't quite so cheap anymore. I have clients with plants in China that are reporting 25% annual bumps in labor costs, rises that are forcing them to source elsewhere.
My son was cursing as he was trying to get Chinese made fence staples driven into a fence post.
He says the joke is on China. They are laughing as they loan the USA lots of money to buy their worthless junk. But the joke is going to be on them when they foreclose and their new aquisition falls into ruins because the cheap junk nails, screws and fastenings bought from China fall to pieces and whatever they were supposed to hold together tumbles down.
Maybe this thread belongs in the Unexplained Mysteries section.
It's truly a mystery that you're posting here, since you don't understand that while China owns $1.2 TRILLION of your public debt, Japan owns $1.1 TRILLION of your public debt.
China owns a decent amount of US debt but they will not foreclose or I assume you meant call it. Firstly, they are bonds will long due dates that are traded in markets. If they sold US bonds and brought the money back into China, then their exchange rate would pop and their export machine would collapse. That's how it works. As for cheap products, they make a lot of cheap crap but that's slowly changing over time. Remember, they also assemble your iphones as well out there.
In China's defense, they can make as high quality merchandise as anyone. Of course, that comes with a corresponding price tag. The real culprit is not Chinese companies, who mostly work on contracted orders, but the US multinationals who are cutting quality corners to boost their profit margins. And boy are they ever boosting them. The real winners in globalization are those US multinationals that are earning record profits, their CEOs with millions in annual bonuses. The loser is the US consumer, who although can now buy a nifty little notebook, no longer works in the factory, now in the PRC, that once made the components for that device. Nope, s/he now gets a low paying job in the service sector with a paucity of benefits. Ain't life grand?
Interesting. Trashing actually hard working country based on cheap staples?
Just FYI, USA owes China $1.2 trillion, I do not think it's a pocket change. That's just the Dragon Family suite for the vouchers for the gold, taken away from China in 1934.
Also, China is closing on introducing golden yuan to the world, which will effectively shut down piece of unbacked paper called dollar.
I doubt they will foreclose.
Finally, China is a classic commodity economy based on cheap labor. Only the cheap labor isn't quite so cheap anymore. I have clients with plants in China that are reporting 25% annual bumps in labor costs, rises that are forcing them to source elsewhere.
Labor arbitrage with China may be ending, but they are no one-trick pony. At present rates, their national R&D will be greater than ours in about a decade. They drill and refine oil overseas. They are building the yuan into the world's next reserve currency. Their cropland is more productive, and their other natural resources are ample. They are #3 in auto production. Their service and telecom industry in decent and growing strongly.
Quote:
Originally Posted by cpg35223
They have been cooking the economic books for years, so much so that nobody really knows what their actual economic numbers.
I read a Wall Street Journal piece over a decade ago (2001 I think) that said the same thing. It is safe to say they have grown substantially since then, so I think we should trust their figures.
Quote:
Originally Posted by Willy702
Man the dumb threads never stop here do they? How do you foreclose on a debt when the payments are current? What do you foreclose on when there is nothing in the debt issue pledging anything but a theoretical share of future tax revenues?
I think China could gradually sell their U.S. bonds and buy gold over a decade or so without causing a sudden shock.
Labor arbitrage with China may be ending, but they are no one-trick pony. At present rates, their national R&D will be greater than ours in about a decade. They drill and refine oil overseas. They are building the yuan into the world's next reserve currency. Their cropland is more productive, and their other natural resources are ample. They are #3 in auto production. Their service and telecom industry in decent and growing strongly.
I read a Wall Street Journal piece over a decade ago (2001 I think) that said the same thing. It is safe to say they have grown substantially since then, so I think we should trust their figures.
I think China could gradually sell their U.S. bonds and buy gold over a decade or so without causing a sudden shock.
Actually, there has been more recent discussion of the fraudulent Chinese economic numbers. One tell is the ratio of Chinese economic growth versus the increase in Chinese electrical production. For years, the growth in Chinese GDP has been twice that of increases in electrical production. In every other country on the planet, the ratio is typically close to 1:1 for a very good reason. There has to be a corresponding increase in machinery, computing, and other equipment to support the increased production.
Further, malinvestment is pretty evident in the construction projects that do not have any market reason to exist. For example, construction comprises roughly 22-25% of the Chinese economy right now, yet there is incredible oversupply in the market. You've read about ghost cities that could conceivably house upwards of a million people but sit unpopulated, right? This is the product of government-directed planning operating without even a scintilla of market awareness. Even now, some cities have excess inventory of 10 years in residential real estate, which makes the recent United States real estate bubble look like a minor bump in comparison. More telling, there is similar oversupply in commercial real estate. Yet the building continues. What happens when roughly a fourth of the Chinese economy literally has nothing to do? It is frightening to consider, given how much much in assets are tied up in what are essentially non-performing investments. Just this week, as a kind of Hail Mary pass, the Chinese have put draconian restrictions on property sales to stop the rampant speculation.
As another example, everybody loves to swoon over the Chinese high-speed rail network, but it's growing evident that the Chinese railways will not be able to service their debt over the long haul according to the World Bank.
What's more, as I noted before, the Chinese commodity of labor is what is attracting manufacturing, not Chinese technical ability. It's worth noting that around 95% of Chinese high-tech manufacturing is assembly only. In other words, the parts come into the country, are put together there, and the finished products ship back out. Even now, countries such as Indonesia and Vietnam are making inroads, taking away production from Chinese factories. Just last year, I attended a trade show where Chinese made goods had been quite visible. Suddenly, this year, the Chinese-made goods were in marked decline while most imported goods came from Indonesia.
As far as the Yuan turning into a reserve currency, I am very skeptical. For example, all this overseas investment you're witnessing is actually seeing is a frantic attempt to put the money anywhere stable before the bubble pops. Further, given the fact that the Chinese government is running budget deficits of 50%, I have doubts whether the Yuan will have any more confidence than the dollar. Finally, as I noted at the beginning of this screed, there is absolutely no indication that the Chinese government has stopped cooking their books. If no one really knows what the economic numbers truly are, it should give serious pause to anyone wanting to use the Yuan as a fallback to the dollar.
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