“China may be growing even faster than you previously thought.”
10 Replies to “Even With The Toxic Toy Recalls Factored In”
If the whole shootin’ match falls apart, as it might, China will suffer worse than us for two reasons:
a) A large part of the boom is fueled by credit expansion by the Bank of China, part of whose purpose is to keep the value of the remmabi down with respect to the US$. If this credit expansion reverses, then a lot of the investments made under its influence will prove to be malinvestments.
b) To the extent that China’s rocketing growth is based on real values, an economic shock is going to hit them worse than it would North America. The simple reason is: in a credit collapse, the creditor loses more than the debtor does. All that a bankrupt debtor loses is the collateral (if any) and future borrowing opportunities that a borrower with an unblemished reputation enjoys. The creditor loses (at least, a large part of) the value of the loan.
Someone in China wrote me that the mentality in China about regulations – and breaking them- is that they are part of a normal mode of business. The regulations are NOT there for any reason to do with the manufacturing quality. They are there as a tactic for Chinese gov’t bureaucrats to be bribed.
The basic agenda of each and all in China is Get RICH. It is each-man-for-himself capitalism. This also means that it is considered normal to get things done as cheaply as possible, to cheat customers etc. But don’t think that China is alone in this mode! I’ve experienced the same ‘I’ll cheat you if I can get away with it’ tactics in various parts of Canada. But in China it’s rampant.
The Chinese gov’t is viewed as a distant, irrelevant out-of-date nonentity. The gov’t bureaucrats are viewed as also ‘each-man-for-himself’. But rather than working as entrepreneurs, gov’t officials can only increase their income by one means. Accepting bribes. And that is the norm in China. Gov’t bureaucrats operate, openly, within bribes.
Govt regulations are viewed as a tactic by the corrupt gov’t bureaucrats to make money off of the Chinese capitalists. Regulations are understood to be put on by these bureaucrats – so that “when we Chinese break them..and we will, because they are not necessary ..we must pay the bureaucrat a bribe”.
And that’s how a LOT of normal business in China gets done. Even to get a visa – you must take the mayor out to a nice dinner.
You ignore the regulation – because they are unnecessary anyway – and are only imposed because the bureaucrat wants to be bribed.
The Chinese way of doing things is meeting up with the Western insistence on quality and gov’t regulations. This is going to be quite the educational experience for them – and for the gov’t.
I’m also wondering what will happen when the bribery income – a VERY VITAL part of the income of Chinese bureaucrats – dries up. What will happen to a gov’t when its civil service, accustomed to receiving a large part of their income via bribes – no longer has access to this income?
Another interesting facet of the Chinese economy is that, unlike Western socialist nations, the Chinese don’t expect the gov’t to do anything FOR them.
We in the West expect our gov’ts to provide us with protection from ourselves and our nasty coworkers, to support us, to provide us with jobs, with health care, with public schooling, ..everything. The Chinese, a theoretically communist country, don’t expect anything from the gov’t except interference. They expect you to protect yourself from ‘lead paint’ (don’t put it in your mouth); to protect yourself from the unscrupulous etc.
We in the West will sue MacDonald’s if their coffee is too hot and if we, ourselves, splill it over ourselves. In China – it’s up to the individual to watch out for themselves. Strange – the reality of ‘communism’ – how it effectively has nothing ‘communal’ in it at all and what is left of the communal – the public big corporations – is crumbling.
If we start to boycott everything made in China we’ll come home empty handed from almost all shopping trips. We even have to watch the foodstuffs.
Santa won’t need all his Reindeer for his annual drop offs, too light a load.
At the rate our leaders are allowing the nation to deindustrialize and become reliant on Chinese production for the most mundane things, there is no end to this prosperity in sight…. except ours.
I disagree. Our household has been boycotting Asian crap for almost one year, and it is feasible. Sure, you must take the time, and pay more, but in the end it is worth the effort. No more walmart garbage for this family, and we do not have to worry if the kids put the toys in their mouths. Just shop at boutiques, craft shops, and indy’s. The goods are higher quality, especially the clothing(plenty still made in NA). Screw the Asians and their toxic goods!
Bear in mind that China does not operate as a capitalist socicety, but more as a (vastly corrupt) mercantile one.
Anyone still wearing rose-coloured glasses?
tenebris – what makes you define China as mercantile rather than capitalist? Yes, the focus has been on gov’t intervention and public ownership, but that is changing. China now has a law respecting private ownership; heh- Canada doesn’t.
But, I think that China is moving, rapidly, into a capitalist system (ie, private ownership of goods and services) – but – the key factor is that, in this ‘in between phase’ – you are still left with an enormous bureaucracy that lives, not simply by salaries but in great part by bribes.
And, with the focus on private enterprise and extreme competition for markets, then, in a country that hasn’t seen competition – there are no or few rules and regulations to ensure quality of the goods and services. AND, even if you have those rules, you still have a party bureaucracy that operates by bribery. This is all going to have to be developed – as China faces the backlash from its export countries.
I disagree with boycotting Chinese goods. China isn’t going to disappear; its population isn’t going to disappear and it is rapidly moving out of the rural to the urban, out of the 19th to the 21st century. What is the point of a boycott? I think we have to engage China not isolate it.
That means that China will be stunned – as they are – by our rejection of bad quality goods. This is a ‘wake-up’ to them. They are having to deal with the products they supply to their own people – which is the same low quality. But to isolate them doesn’t make any sense to me.
I still am wondering how they are going to deal with a civil service who have lived, not by salaries, but also by bribery. That is something else that China will have to deal with.
But again – rejecting them with a sneer of contempt doesn’t make any sense to me.
Bad news for those who think they can boycott Chinese goods. A lot of the parts are manufactured in China and then assembled elsewhere. They are labelled manufactured in the country of final assembly. It truly is a global economy. There is nothing wrong with free and fare trade. Currency manipulation is another thing. Most governments around the world are now engaged in that game by creating money at double-digit rates. This by the way is what creates the invisible tax called inflation. More money chasing the same number of goods causes currencies to depreciate. This is the goal of exporting nations (to keep their currency cheap in comparison to other currencies). It could be argued however that the Chinese are actually getting the worst of the deal. They are exchanging real goods in exchange for increasingly worthless paper.
Why are we still allowing these imports from china even after this?
If the whole shootin’ match falls apart, as it might, China will suffer worse than us for two reasons:
a) A large part of the boom is fueled by credit expansion by the Bank of China, part of whose purpose is to keep the value of the remmabi down with respect to the US$. If this credit expansion reverses, then a lot of the investments made under its influence will prove to be malinvestments.
b) To the extent that China’s rocketing growth is based on real values, an economic shock is going to hit them worse than it would North America. The simple reason is: in a credit collapse, the creditor loses more than the debtor does. All that a bankrupt debtor loses is the collateral (if any) and future borrowing opportunities that a borrower with an unblemished reputation enjoys. The creditor loses (at least, a large part of) the value of the loan.
Someone in China wrote me that the mentality in China about regulations – and breaking them- is that they are part of a normal mode of business. The regulations are NOT there for any reason to do with the manufacturing quality. They are there as a tactic for Chinese gov’t bureaucrats to be bribed.
The basic agenda of each and all in China is Get RICH. It is each-man-for-himself capitalism. This also means that it is considered normal to get things done as cheaply as possible, to cheat customers etc. But don’t think that China is alone in this mode! I’ve experienced the same ‘I’ll cheat you if I can get away with it’ tactics in various parts of Canada. But in China it’s rampant.
The Chinese gov’t is viewed as a distant, irrelevant out-of-date nonentity. The gov’t bureaucrats are viewed as also ‘each-man-for-himself’. But rather than working as entrepreneurs, gov’t officials can only increase their income by one means. Accepting bribes. And that is the norm in China. Gov’t bureaucrats operate, openly, within bribes.
Govt regulations are viewed as a tactic by the corrupt gov’t bureaucrats to make money off of the Chinese capitalists. Regulations are understood to be put on by these bureaucrats – so that “when we Chinese break them..and we will, because they are not necessary ..we must pay the bureaucrat a bribe”.
And that’s how a LOT of normal business in China gets done. Even to get a visa – you must take the mayor out to a nice dinner.
You ignore the regulation – because they are unnecessary anyway – and are only imposed because the bureaucrat wants to be bribed.
The Chinese way of doing things is meeting up with the Western insistence on quality and gov’t regulations. This is going to be quite the educational experience for them – and for the gov’t.
I’m also wondering what will happen when the bribery income – a VERY VITAL part of the income of Chinese bureaucrats – dries up. What will happen to a gov’t when its civil service, accustomed to receiving a large part of their income via bribes – no longer has access to this income?
Another interesting facet of the Chinese economy is that, unlike Western socialist nations, the Chinese don’t expect the gov’t to do anything FOR them.
We in the West expect our gov’ts to provide us with protection from ourselves and our nasty coworkers, to support us, to provide us with jobs, with health care, with public schooling, ..everything. The Chinese, a theoretically communist country, don’t expect anything from the gov’t except interference. They expect you to protect yourself from ‘lead paint’ (don’t put it in your mouth); to protect yourself from the unscrupulous etc.
We in the West will sue MacDonald’s if their coffee is too hot and if we, ourselves, splill it over ourselves. In China – it’s up to the individual to watch out for themselves. Strange – the reality of ‘communism’ – how it effectively has nothing ‘communal’ in it at all and what is left of the communal – the public big corporations – is crumbling.
If we start to boycott everything made in China we’ll come home empty handed from almost all shopping trips. We even have to watch the foodstuffs.
Santa won’t need all his Reindeer for his annual drop offs, too light a load.
At the rate our leaders are allowing the nation to deindustrialize and become reliant on Chinese production for the most mundane things, there is no end to this prosperity in sight…. except ours.
I disagree. Our household has been boycotting Asian crap for almost one year, and it is feasible. Sure, you must take the time, and pay more, but in the end it is worth the effort. No more walmart garbage for this family, and we do not have to worry if the kids put the toys in their mouths. Just shop at boutiques, craft shops, and indy’s. The goods are higher quality, especially the clothing(plenty still made in NA). Screw the Asians and their toxic goods!
Bear in mind that China does not operate as a capitalist socicety, but more as a (vastly corrupt) mercantile one.
Anyone still wearing rose-coloured glasses?
tenebris – what makes you define China as mercantile rather than capitalist? Yes, the focus has been on gov’t intervention and public ownership, but that is changing. China now has a law respecting private ownership; heh- Canada doesn’t.
But, I think that China is moving, rapidly, into a capitalist system (ie, private ownership of goods and services) – but – the key factor is that, in this ‘in between phase’ – you are still left with an enormous bureaucracy that lives, not simply by salaries but in great part by bribes.
And, with the focus on private enterprise and extreme competition for markets, then, in a country that hasn’t seen competition – there are no or few rules and regulations to ensure quality of the goods and services. AND, even if you have those rules, you still have a party bureaucracy that operates by bribery. This is all going to have to be developed – as China faces the backlash from its export countries.
I disagree with boycotting Chinese goods. China isn’t going to disappear; its population isn’t going to disappear and it is rapidly moving out of the rural to the urban, out of the 19th to the 21st century. What is the point of a boycott? I think we have to engage China not isolate it.
That means that China will be stunned – as they are – by our rejection of bad quality goods. This is a ‘wake-up’ to them. They are having to deal with the products they supply to their own people – which is the same low quality. But to isolate them doesn’t make any sense to me.
I still am wondering how they are going to deal with a civil service who have lived, not by salaries, but also by bribery. That is something else that China will have to deal with.
But again – rejecting them with a sneer of contempt doesn’t make any sense to me.
Bad news for those who think they can boycott Chinese goods. A lot of the parts are manufactured in China and then assembled elsewhere. They are labelled manufactured in the country of final assembly. It truly is a global economy. There is nothing wrong with free and fare trade. Currency manipulation is another thing. Most governments around the world are now engaged in that game by creating money at double-digit rates. This by the way is what creates the invisible tax called inflation. More money chasing the same number of goods causes currencies to depreciate. This is the goal of exporting nations (to keep their currency cheap in comparison to other currencies). It could be argued however that the Chinese are actually getting the worst of the deal. They are exchanging real goods in exchange for increasingly worthless paper.
Why are we still allowing these imports from china even after this?