Yes, people in China want to have things like refrigerators, toilets, showers [warm ones], bicycles, train tickets, warm jackets, sun glasses, shoes, gloves, finger nail clippers, scissors, toothbrushes, and let's not forget Mq's amazing mobile cyberspace Interwebs devices with mirasol built in. But they want those things now, not in 30 years. With the cost of credit as low as it is, buying those things on credit would be worth doing. 30 year interest rates aren't very high and mobile Cyberspace is needed NOW, not next year, to earn a living and manage life. A warm jacket would be worth buying at the beginning of winter too, not in 10 years time: <China itself wants to transform into a consumer society over the next 30 years, so is moving low-cost manufacturing to countries such as Vietnam and Bangladesh. Increasingly, it will focus on investments and industries that give China a technological advantage.
China will do to high tech what they did to textiles footwear, and, well, everything. >
Yes, of course people in Vietnam and Bangladesh decide that it would be better to do some work and upgrade from living in mud and they are willing to work for less pay than people in China who have already got a pretty good standard of living compared with when it was really bleak there.
For decades I have thought China should be doing to high tech what they did to footwear, textiles and everything = doing it better and cheaper. Yes, they have the murderous melamine milk manufacturing methods, but that's just a matter of quality control. Japan figured out half a century that producing high quality products was a much better way of earning a living than producing the cheap junk that sort of looked the part but was really a scam, or broke soon after buying it.
You have seen me ranting about Huawei for years. They are now about to overtake L M Ericsson and good riddance to the leading member of the Hagfish Guild of Slimeballs.
Those are good things to happen, but not for those who are displaced.
TJ for example pays for my groceries [by buying his latest geewhizwoahohwoee mobile cyberspace DeVice which he prefers to spend time with than his boring stash of gold and a naughty weekend away with his DeVice is preferable to being with his delightful wife at times. I'm sure he cannot believe how amazing and how cheap the latest Incredible devices made by HTC
are.
Huawei can hire Africans and Brazilians to install fibre and base stations and supply cyberphones in Angola. China has loads of US$ and could lend Angolans money with which to buy things Made in China [or India, Bangalesh, Vietnam]. You seem to prefer installing fibre in Angola than waiting for another innocent tourist to shoot in the back to steal their watches.
China swapped $5 billion of US$ for NZ$ recently. That was an interesting move. They can now go shopping in NZ and have got rid of a bunch of dodgy US$ which they have enough of for now.
John Key, prime minister of NZ and currency trader extraordinaire [in his previous career in the financial markets] obviously agrees with me that NZ$ is a pretty good short at US80c. When the prime minister is shorting the currency, it's suggestive that it is probably a good idea. When he also is a world class expert at currency trading, it's a fairly good bet that he is right. Especially when, unlike the Fed, he controls the Reserve Bank of New Zealand which is in charge of NZ$ dilution.
China will use those NZ$ to buy groceries from NZ [sooner rather than later] and NZ will use US$ to buy things such as ship-loads of Saudi crude oil and fleets of new BMWs [Helen Clark's government ordered for her politburo - a gaggle of gay so-called "for the people" socialists who are not averse to feathering their own nests with opm]
Recommendation = short NZ$ vs US$. Buy mobile cyberspace DeVices.
Mqurice
PS: $10 billion is real money in NZ with only 4 million people [mostly impoverished] and 40 million sheep. |
