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Pastimes : QQQ & DIA - chat & chart -- Ignore unavailable to you. Want to Upgrade?

To: pass pass who wrote (567)	5/11/2003 6:21:07 PM
From: MeDroogies	Read Replies (1) \| Respond to of 795

I don't disagree that the Chinese have brought many things, but deflation isn't one of them. SARS, for one thing, has put a major crimp in the delivery of manufactured goods. For another, the Chinese need to invest their dollars someplace, and a lowest common denominator economy (which China is, since it is so labor intensive) is not a good place to put hard earned dollars. Watch the Chinese Central Bank. They are buying the dollar like mad to keep their trading options open, since a strong dollar benefits them. Should the dollar weaken, we no longer have the "cheap" Chinese stuff. Besides, show me a study that indicates that China is more productive than the US worker. I have yet to see a single study that shows foreign workers, regardless of how cheap they are, can produce at a more efficient rate than a US worker. That is the fallacy of US companies shifting jobs abroad. Cheap workers look good on paper, but produce far less, making them relatively more expensive overall. Mostly, US companies have shifted overseas to comply with laws in those countries about local production, and meet guidelines about imports. The US remains one of the few countries with relatively free markets in terms of import/export. We subsidize exports and tax imports far less than most other nations, despite GATT. I wouldn't load up on anything, despite the gains computers have given us. Adding computing power doesn't add productive capacity beyond a certain point...and one can argue many companies have reached that point.