Hello Darfot,
<<China works so hard to keep the RMB at its current fix to the USD?>>
I honestly believe that if China floats the currency, it will blip up and then crash down, because of its 300-years of pent up demand, legacy baggage from days of communist experiments, and the role money printing can play in the resolution.
I also firmly believe that should China re-peg at another but higher rate, the Chinese private sector (as opposed to the central bank) will de-camp the RMB because the private sector understands the true worth-less nature of the RMB.
So, currency exchange rate setting is an art form, and given the current perceived perfection of the RMB:USD rate which saw Asia through the Financial Crisis, is not a computer game as the US officialdom believes it to be, nor is it the secret sauce that will save US manufacturing. If it were not the case, British manufacturing would never have declined in favor of US manufacturing.
<<accumulation of huge amounts of US assets, a la Japan … very inflationary>>
Per these posts, China should not be miscalculated for a Japan, part II:
Message 19505900
Message 19506147
… as in regard to inflation, China ‘needs’ inflation as much as America and Japan ‘needs’ inflation, and the officialdom is equally enthusiastic as professor BurnAndKaput; so, accumulate gold is a winner of an idea, brainless as well.
<<also, i have read in several places (including Duncan's book, i believe) that unskilled factory workers cost $3-4 per day; is this true?>>
No, it is not true. Duncan’s number is up to 400% too much, depending on specific China location.
<<manufacturing job drain from the West means for the West?>>
TeoTwawKi achamchen.com for A2V to W3C, perceived as abracadabra achamchen.com of M9 magnitude, disguised by the ambiguity of financial collapse, camouflaging an inflection point connecting Silicon Glory to an as yet unknown “next abracadabra”, as the Rust Belt was once transformed into Silicon Glory but accompanied by much dying anguish and birthing pain per script here Message 16212324 <<August 15th, 2001>>.
Does my cheery and sunny outlook of fire and brimstone scenario best Russwinter’s best :0)
<<a recent Grantham interview in Barron's found him rather sanguine at the prospect of, say, another 6 million such jobs down the drain here>>
… yup, it is going to be bad, very bad, and no politician dares to tell the truth as it is, preferring to hide amongst the facts, allowing the financial markets to do their usual thing, as in Message 18243386 <<again and once more, ad infinitum, ad nauseam, so on and so forth ... et cetera, and then it starts all over again, or, as they say on Wall Street, ABRACADABRA>>
<<i am not sure that overall corporate margins can support the kind of lifestyles we like in the US on just service margins>>
… do not be unsure. I think you can be very sure that most Chicago-based mould maker with the USD 150k annual compensation is an endangered species marked for extinction, just like the Seattle domiciled Java programmer is like a blue-water whale swimming against the flow up the piranha infested Amazon River.
<<the WSJ recently had an article which stated that the going rate for a live-in maid was around $50 a month in Chinese metro areas>>
Yup, in metro Beijing/Shanghai, but cheaper in the second-tier cities. The supply engenders demand, and the exchange clears at market price, subsidized by no government rich enough and supported by no bank foolish sufficiently.
Chugs, Jay |
