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To: TobagoJack who wrote (6760)	8/6/2001 11:32:38 AM
From: KyrosL	Respond to of 74559

Jay, thanks again for a great perspective on China. It demolishes many of the myths that pervade not only the people in the US, but, unfortunately, also our government.

To: TobagoJack who wrote (6760)	8/6/2001 11:50:32 AM
From: Moominoid	Respond to of 74559

Great post, China is the second biggest economy in PPP terms (unless you count the EU as a single economy). The attitude to China here (in Australia) is how to get into China to service the Chinese domestic economy. But maybe you write off India too easily? David

To: TobagoJack who wrote (6760)	8/6/2001 1:16:31 PM
From: elmatador	Read Replies (1) \| Respond to of 74559

Without abracadabra, China could take the world out of the nose dive. Germany had in the late 80's some USD90 billion in reserves. That was enough to 'buy' the Eastern side of the country from the communist era. That created a positive economic effect in the whole Western Europe that lasted the early 90's. (Not to mention: that Western Europeans got rid of a lot of old cars, got cheaper(and better looking) nannies. China could get those huge USD reserves from Taiwan and make China the world's economic engine. The problem is: Western countries would have to acknowledge that China had arrived. It would be difficult to get the hands on those Taiwanese reserves.

To: TobagoJack who wrote (6760)	8/6/2001 1:21:35 PM
From: Ilaine	Respond to of 74559

>>I had always quipped that communism requires a lot more wealth than capitalism.<< I've come to believe that the most accurate argument against communism and socialism is not that government performs functions that it should not be performing, but that government is performing functions that it cannot perform well. Taking on too much responsibility that it just can't handle properly. This is more of a practical observation than a philosophical observation. The main reason communism requires more wealth than capitalism is that no government functionary is ever going to work as long or as hard as an entrepreneur, nor will anyone getting a government paycheck ever forego payment nor delay gratification. Why should they? They don't have a chance of making it big. They get paid the same no matter what.

To: TobagoJack who wrote (6760)	8/6/2001 1:30:30 PM
From: LLCF	Respond to of 74559

SAN FRANCISCO (Reuters) - Venture capitalists are chasing a lucrative breakthrough many see as just over the horizon -- bridging the proverbial ``last mile'' to link metropolitan-area optical communications networks to long-haul networks. In recent months, venture capital has been making big contrarian bets on start-up communications component makers whose products promise to ``light'' fiber already in the ground by connecting major networks and their would-be urban customers. The pace of venture funding shows no sign of letting up even in the face of an inventory glut and overbuilt networks that have made the year one of the most punishing for investors in such publicly traded suppliers as JDS Uniphase Corp. (JDU.TO). ``The long-haul networks are all pretty built out, but on the metro-network side, we are going to need some advances,'' Doug Robertson, a principal with Palo Alto, California-based Crescendo Ventures, told Reuters. DAK

To: TobagoJack who wrote (6760)	8/6/2001 5:27:28 PM
From: Jacob Snyder	Read Replies (4) \| Respond to of 74559

Thanks for that informed and well-reasoned reply. You seem to be saying that China is so big, that it's huge inertia and mass will give it different dynamics than other developing nations. Sounds reasonable. But is it a qualitative difference, or just a quantitative difference? Correct this if it seems wrong: A developing nation can grow its economy only by investing large amounts of capital. There are two broad sources of this capital: external and internal. Generating the capital internally, in a poor country, means keeping living standards very low, and enforcing strict discipline, for a couple of generations. This was Stalin's and Mao's method (starve the peasants while they build the dams and factories). Going back to that method is not an option today, for China. So, a growing economy means China has to continue to attract foreign capital (at the rate of U.S. $10s of billions/year). That foreign capital can only be attracted, in the necessary amounts, if there are foreign markets to sell into. The domestic market, the levels of domestic consumption, is still not nearly enough to justify foreign capital investment anywhere near the current levels. So, foreign consumers are crucial to the stability of the current Chinese government,(whose legitimacy now rests entirely on economic performance, now that Mao Thought has been discarded). Eventually, domestic consumption will be the main driver, but that point is still a number of years off. You're seeing a vast pent-up demand in China today. Sure there is. There is also the same demand in, say, Sudan, but that demand will never be met (in either China or Sudan), unless the proper environment for capital is present. And my point was, that "proper environment" requires foreign consumers to keep buying. Re: privatizing state-owned enterprises: Is it true that most of these, as in the Soviet Union, are net value-subtractors? That is, the raw materials they use, are worth more, in world markets, than the finished products are? Isn't this broadly true, with the exception of the defense industry, which won't be privatized? So......aside from accounting games, the actual value of these companies is........nothing. Therefore: all the value-added in the Chinese economy happens in the private sector, and the defense industry. Other random thoughts: Someone mentioned India as a possible rival to China. All the multinational empires created in the 1500-1919 period have dissolved into their constituent ethnic units. India is the only one left, and I don't see any hope of them resisting this powerful longterm historical trend. So, the best that can be hoped for, is that they have a peaceful divorce (like the Chechs and Slovaks), rather than a contested divorce (far, far more examples of this in the historical record). So, when the world becomes bi-polar again, the only candidate to ascend to superpower status beside the U.S., is China. -------------------- In spite of recent gloom, the U.S. system remains the global standard everyone else is trying to imitate. That status was achieved because of the system's results: as the 2000 census results come out, we see: 25.1% Americans with college degrees , compared with 20.3% in the 1990 census......66.2% of American households owning their own homes......nearly one of five new houses exceeds 3,000 square feet.......More than 90 percent of households owned a car, van or truck......