Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (558256)	4/1/2010 8:37:52 PM
From: combjelly	1 Recommendation Read Replies (2) \| Respond to of 1576346

"Why do you think they are at risk?" They have turned their economy into an export monster. Which isn't sustainable, just ask the Japanese. So, if they can't transition to a more consumer driven economy, they are going to hit a wall. That is where a cultural aspect comes into play. When you read the history of China, one thing pops up over and over. The Mandate of Heaven. The various emperors were given carte blanch because they were supposedly given the blessings from Heaven. But, if things went wrong, that meant they were no longer blessed and China would fall apart into little warring fiefdoms. The same sort of attitudes got transferred over to Mao and the Communists. Which is why they pushed the concept of the Iron Rice Bowl. Basically, the government agreed that everyone would be housed, fed and otherwise taken care of. The trade off was their word was law. The Rice Bowl was broken in the early 1980s. That led to unrest that was only quelled when the government started their drive to become an export driven economy using Japan as their model. The rising affluence meant the unrest was put on hold. And that has kept a lid on things. But that only works as long as other countries, in this case primarily the US, allows them to get away with the necessary currency manipulation and the harm to their own economies. That seems to be changing. It isn't going to be easy for China to make the transition to a consumer driven economy. A consumer driven economy needs to be efficient, and China is far from efficient. And weeding out the inefficiencies is going to be painful, especially in the areas which have gotten used to some affluence. Those areas have also been attracting population from all over China, and the later ones will be the first to take it in the neck. Since the growth has been more or less exponential, there are also a lot of them. So, what happens when the fecal material hits the rotary impeller? Mere brutality will only get the government so far. The classical dilemma for invaders of China is that sooner or later you run out of arrows/bullets/whatever. And then the surviving Chinese each picks up a rock and... The same is true with the government vs. the population.