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Gold/Mining/Energy : Gold Price Monitor
GDXJ 93.43-4.5%Nov 20 4:00 PM EST
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To: Hawkmoon who wrote (57695)8/30/2000 1:55:57 AM
From: The Vet  Read Replies (1) of 116764
 
OK Ron, I pondered your points. The US was in a unique position in 1945. Virtually all of the world had suffered serious damage to their production capacity and infrastructure while the US mainland was virtually unscathed. It is hardly an example of the normal economic state of the world.

Your city/country example is instructive and is actually a good illustration of my point on a local scale. The farmers often have more capital invested, better skills and work harder than those city folk. The farmers are in fact subsidising the city with cheap food and getting inadequate returns for their investment and labour. Because of that they can't buy the city produced goods.

Do you think that the farmers want to sell their products so cheaply that they can't get a decent living? In fact the prices they can charge are not a product of true supply and demand but a result of market intervention and regulation by government and commerce at all levels.

And you are right you can apply this to an international level.... that is my point! The US is the city and the rest of the world the farm.

If China charged US prices for the goods it produces inflation in the US would be sky high, Wal Mart would be empty, and half the US population would running around naked! Where is the US going to find half a billion machine operators to sew clothes and stamp out cheap plastic and metal goods.
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