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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: marginmike who wrote (207729)12/3/2002 9:46:05 PM
From: robnhood  Read Replies (1) of 436258
 
Deflation baby--- seductive face, but one mean MF'R

<<offal () ID#175191:
Copyright © 2002 offal/Kitco Inc. All rights reserved
click here ...

Mr. Kanno at J.P. Morgan says the surge in the yen and rise of China as the world's cheapest manufacturer, was a major factor in the transition to deflation in Japan.
nationalpost.com{62CC0032-4AA2-4CC4-A540-D3633CD72D5E}

"That is the main source of the wage deflation." The wage differential between the two countries is about 40 times, an advantage that will let foreign investors overlook just about anything, including rampant corruption and a rickety financial sector.

While China's share of U.S. imports has doubled to 11% in the past decade, the United States has a much smaller manufacturing base than Japan -- a key factor that Mr. Kanno thinks will prevent U.S. wages from coming under downward pressure -- at least for now.

"Let's say five years from today, China will be a country that's exporting automobiles," Mr. Kanno speculates. "The auto industry is the last big manufacturing industry in the U.S. What do you think could happen? Even the Big Three will have a big incentive to shift production to China to keep market share. Then I'd say the U.S. would be in a similar situation to Japan." >>
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