<<There has to be some point where it makes sense to shift production back to the US>>
... that is not how "Fiat Money Inflation" traditionally works;
USA is the source of the inflation. Oil price increase is just a symptom and nothing more, less the bit about ChIndia growth/reform.
It will be more expensive to make stuff in USA until (i) USD collapses and lose reserve currency status, which is a while off yet, or (ii) USA is completely drained of middle class, which has a way to go as yet.
So, given the rub and grind required, the outcome will likely be a lot of each over quite a long time, but not as long as some would contend.
<<Or else we just stop consuming so much stuff?>>
... that will happen near the end stage, when 5% of the global population consumes 5% of its resources, down from 25%, by action of destruction of its monetary regime, and pulverization of its productive enterprise, and or same same of middle class.
It is all scripted out in "Fiat Money Inflation in France", the definitive book, and previewed from Argentina to Zimbabwe, in 3D and 3D surround sound.
But, before here and there, there will likely be a big wobble that makes much difference to many over a short painful time, and after departing here but not yet there, also, the dark interregnum.
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