"The China Price" - The best business article I have seen in years.

And how long will it be before


(A) Chinese demand Boeing or Airbus set up "cooperative" factories in China producing planes for "domestic" Chinese market?

(B) Managers and engineers employed at such companies suddently jump to nearby all-Chinese startup aircraft company which suddently is making high quality aircraft?


remember that Chinese used to make plastic toys just a few years ago.

 

It was in the NY Times, Airbus will be producing A320's in China soon for domestic use.

Hey, there is still hope for America. With all the illegals here, we will still be China's bread basket. :eek:

Anything to keep them lending money to us.

 

i find this so weird. all these economic "threat" stories. i always thought if china does well, it must be good for US as well. if china doesn't do well, (economic collapse) then the US will feel the pain as well (who else is gonna finance their debt).

 

The Chinese economy must be in big trouble. "Business Week" is legendary for being dead wrong extrapolating existing trends into the future. Remember "The Death of Equities"? Japan Inc.? The East Asian Tigers? The almighty European Union with its 600 zillion consumers? Yada, yada, yada. Now it is "Chindia"'s turn to dethrone the U.S.

I will believe it when I see it.

 

So much propaganda, are you sure southamerica that you aren't on the Chinese payroll or something? Sheesh.

This is how I see this popular trend around the world on anti-US sentiment. The US is like a big strong guy. The rest of the world are like weak women. If a guy slaps a woman there is outrage, how can he do such a thing?! But if another woman slaps another women, no one gives a hoot, not a glance. The reasons don't matter, the only thing the rest of the world cares about is that the man slapped the poor helpless woman. This illustrates the relationship between those with power and those without or those who feel superior and those who feel inferior. The anti-US trend is the lashing out of those who feel inferior. Notice I said "feel", it's these feelings that give rise to sentiment.

Besides your HUGE anti-US slant you provide a lot of your figures in percentages. Like China allowed 60% more investment vs. Japan or something like that.

You don't seem to understand the price and time value. You can't directly compare investments from different time periods. And different economies. Like Titantic grossed the most money ever beating Star Wars which made $400million. But that was $400million in the 1980's. You see the problem with pretty much all your figures??? You are comparing Apples to Oranges and at different times.

You also don't seem to go very in-deep with your analysis. You say if China allows the Yuan to float then it wouldn't have much of an effect in the US economy since there is only like a $56 Billion trade deficit. Do you know what things are included in those figures? Do you realize that almost all of that amount is mostly goods and tangilble assets, stuff you can buy at Walmart type things? Just like the US GDP calculations, the formulas are like 60 years old, before anyone imagined the "soft" assets that would dominate the information age. So if China allows the Yuan to float then they become less competitive in a whole array of industries. It would be a snow ball effect of enormous proportions affecting the "soft assets" that are not captured in any reported data. China knows this, they are not idiots.

This is also the reason why the US economy is strong, because it has shifted from the old world economy to the new one where the information and intellectual property is not captured. Companies like Microsoft, Oracle, Accenture, the list goes on, are not really accounted for in the GDP! I don't know why you are talking about new jobs created. You talk about how pathetic it is that only 200K jobs were created in a month. The only thing patetic is your bias on this matter. Why don't you talk about employment rates? I'm pretty sure the US has one of the best employment rates of any country.

I think people around the world love the idea of the US becoming irrelevant. They await that day and will champion anyone that will take their place. That is sad thing to wish and hope for. The US is the greatest nation state in the history of the world. It's so diverse with everyone from all over the world living and working together. It's truely amazing and I don't know why there is so much anti-US sentiment. Basically you are hating your own brothers and sisters that live and work there. Last time I checked the latin american community was 12-15% of the population!

And look at yourself, in all your articles all you do is talk about American companies, like Fortune, Intel, Walmart, etc etc etc.... All your focus and attention are on these US companies. Why if the US is becoming so irrelevant. Why not talk about Chinese companies and STOP talking about US companies like they are the center of the world.

You have hole after hole in all your posts and the fuel that burns the ranting on your part is your anti-US slant.

Let me help you see clearly. With the 3 "super powers" US, China, and Russia. Name one country that China and Russia has gotten involved with that you would consider a success today? North Korea? Vietnam? Cambodia? East Germany? yeaaaaaah, right.
Ok the US isn't perfect but I would consider Japan, West Germany, South Korea (all in the top 10 economies of the world) pretty much successes.

It's so very clear but people just forget. They forget all the horrible atrocities China and Russia have done and write about stupid things in the US, like subway systems getting old and slave labor at prisons (without mentioning that these people do it voluntarily and they learn new skills that they would have to pay for in vocational schools). Why not write about how the Chinese officials executed a bunch of prostitues that slept with Japanese business men last year in South China? What, it doesn't fit in your anti-US / pro-China ranting? If you even did 1/100th the digging you do about the US you would be horrified at what you would find in China. China will be the next super power, it is no doubt a great nation, but it needs a lot of work. If there were no US this would be a scary world with a growing super powerful China.

So maybe you should put your jealousy aside and stop criticizing the US and try contributing to a better world. BTW, I'm writing this from Hong Kong which is under Chinese rule.

 

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WD40: but the Chinese are still flying in American made Boeings.


******


Drchaos: And how long will it be before

(A) Chinese demand Boeing or Airbus set up "cooperative" factories in China producing planes for "domestic" Chinese market?

(B) Managers and engineers employed at such companies suddenly jump to nearby all-Chinese startup aircraft company which suddenly is making high quality aircraft?


**********


April 10, 2006


SouthAmerica: The Brazilian airplane manufacturer Embraer – the 3dr largest airplane manufacturer in the world – made an agreement with the Chinese to start manufacturing Embraer jets in mainland China.

Embraer is not Boeing or Airbus today, but let’s talk in another ten years and see which company will be the world leader at that time.


.

 

So you've noticed those tanks around the corner ready to do a HongKongaMin Square if you make too many anti-beijing posts here at ET.

Personally I think that China could be very big ... but it could be a big success or a big fuckup ... I have no definite view. I'll trade it whichever way it develops.

 

I'm just waiting for the day that China has a strong middle class. That's gonna be one helleva boom in the the global economy and stock markets. Can you imagine the trends in stocks when hundreds of millions of people are investing... nice....

Although that may be some years away.

 

Agreed, seems like the global economy is so intertwined co-dependency is the norm.

 

Just got copy of, money week


Everyone was recommending getting into China. But after years of experience, we've learned that when everyone is thinking the same thing, no one is thinking at all.

Besides, everyone knows you can't trust the information coming out of China. At best, it is biased. At worst, it is pure lies.

So we sent our own correspondent, Dan Denning, to China to get to the truth. He went everywhere, talked to everyone who spoke English and saw with his own eyes the dramatic and exciting story that China has become. His conclusion:

“Yes, China is a long-term buy. It is the next powerhouse economy. It is the economy of the 21st century.

“But no, China is not a buy now. Instead, it's a time bomb. Here's what's happened.

“Over the last year, there has been a frenzied rush into China. Shares have risen by more than 50%, despite the fact that the economy has grown only 9% and rates are soon likely to rise.

“As soon as consumption falls off in the US - as surely as it will - the Chinese export-led economy will be hit hard. At the same time, a bubble is developing in the property market (prices in Shanghai and Beijing have seen double-digit growth for a few years now and speculators have been piling into a building boom) and many of the country's banks are in a poor state financially.

“Longer term, it won't be a smooth ride either. For starters, take the fact that China has no meaningful pension system, despite the fact that by 2025 it will have 220m senior citizens with no real social safety net (China's one-child policy has left them without a traditional support network). Then there is the public health cost of China's rapid development. This kind of fast-paced industrial growth hits the population hard. And it implies big medical bills in the future. This rather suggests that China's comparative advantage as a low-cost manufacturer is not sustainable.

“There's also a political risk in China: more than 50% of China's population still works in agriculture and lives in a state of poverty. As it gets richer and its farmers get older, at the very least you have an economic problem. At worst, you have a political one: the rural interior versus urban coastal populations and mega cities, perhaps. Now is not the time to be holding Chinese stocks.

“To make a long story short, Americans bought and the Chinese sold. Americans borrowed and the Chinese lent. Americans squandered their capital and China built up its capital. Everybody has over done it. The Americans have too much debt. China has too much capacity. The next stage won't be much fun for either of them... though China should come out much better off in the long run.”