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Strategies & Market Trends : Booms, Busts, and Recoveries
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To: TobagoJack who wrote (63701)5/9/2005 7:54:52 PM
From: energyplay  Read Replies (1) of 74559
 
I have read that China might build enough factory capacity to manufacture about 80% of the goods in the world.

After building that much additonal capacity, won't these factories be at the tender mercies of Wal-Mart, IKEA, Macy's, and the purchasing departments of Toyota, Hyundai, and Sony ?

What is this going to do to factory wages - keep then down so low that an internal market in China won't develop ?

Isn't there going to be a bit of a squeeze between higher raw material prices (Copper, coal, iron ore, oil) and the desire of the buyers for ever lower prices ?

So China ends up suppling near zero cost labor AND through State bank susbsides, some zero cost capital ?

Reminds me about some of the dot-com business models.
Of course, they could make it up in volume....
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