Some countries consume to make a living. Some countries export to make a living. All countries debase their currency. Such is keynesian economic life today.
Everyone knows america is all about consuming as much as possible, go to any mall during the weekend, its usually packed with people buying things they dont even need.
Comparison is such a way is simply fallacious, there is simply no context. Take for example Singapore and Norway, GDP per capita, adjusted for PPP. 3 Singapore 61,103 2011 4 Norway 57,092 2011 7 United States 48,442 2011 Is the average american going to be as rich as the average Singaporean? Very unlikely, but they like Norway have a population of about 5 million. It is much easier to generate and apportion wealth the smaller your population is. Now you have China, which is a country roughly the size of America with 4-5x the population. Given its massive population size, for China to have the same level of GDP per capita is very very difficult, probably never possible. There are always going to be more poor people in China than the USA. However the flip-side is also true, in time to come, there will be in absolute terms more rich people in China than the USA. For example this year, news research tells us that the Chinese are now the largest consumers of high end luxury goods in the world. BEIJING, Jan. 19, 2012 /PRNewswire-Asia/ The rapid development of China's luxury consumer market is garnering global attention. World Luxury Association's official report on 2012 shows that China has become the world's largest consumer of luxury goods
North american and Euro marketing machines know there is an entire country of new dumb ass noob retail consumers ripe for the picking. the culture will suck up anything with a designer label on it. they live for this crap.
Playing devil's advocate.... Who would you rather be: 1- Poor Chinaman working 6 days a week earning $5k/yr with a 38% savings rate, while living in conditions that would make most trailer park residents blush or 2- American consumer, who lives in a 4-BR McMansion, with 2 cars, an office job pushing papers around, with a -1% savings rate
Problem in China is same as in other Asian countries. Lousy return on capital. They work like dogs and save a ton but invest that money in bad businesses and other malinvestment like trains, empty airports, empty stadiums, overbuilt real estate, etc. So wealth is growing, but only due to working hard and saving. In fact the whole concept of ROIC is foreign to China. The goal is to grow revenues, produce jobs, gain market share, not produce profit. The Chinese are a bunch of worker bees slaving away for the Queen Bee, who nobody knows is dead.
Is this inherently bad? Should we rather be more like the soviets in 80's - where there's nothing to consume? Or is our love of consumption and finding more ways and more things to consume the engine that brought us this far?
China's Interest rate is at 38%? That is awesome. Why does our GDP keep growing along with the debt? Consumption is the biggest part of GDP and believe me.. We can consume. Problem is now a days everyone expects to live in McMansions with an Armani suit, smoking a stogy after work and drive their BMW home to their banging hot wifey...Who they drill every night. Everyone wants to live the high life when that isn't possible. We aren't producing anymore which is why the US lost $20 billion a month from Free Trade Fiscal Year 2011. The chinese are still enslaved workers in poor conditions. We were like that once. We came out on top with the newest technology and reaped the benefits of our ancestors hard work. The federal reserve cannot keep the interest rate artificially low much longer. http://www.youtube.com/watch?v=G42JYzJkupg&feature=relmfu
Isn't this done mostly on credit since the 1970s? The Chinese can't get credit so they have to save for things. Their time will come also. I read once that it is the comparisons that matter. If everyone is perceived as poor, then that is OK for most people. It is only if most are perceived as better off that trouble arises. (not absolute wealth but relative wealth.) ......... The chinese are still enslaved workers in poor conditions.............. [/QUOTE] Isn't debt slavery worse for the middle class? (Although the conditions are better. )