Europe Default Would Great For Farang

[Naam]

I am confused. We don't build very much in the West and China builds everything...

you sound indeed confused

two examples:

European Union exports to China 2010 ....................€ 127 billion

China Exports to European Union 2010....................€ 235 billion

U.S. exports to China 2010.......................................€ 77 billion

China exports to U.S. 2010.......................................€ 215 billion

[nong38]

I am confused. We don't build very much in the West and China builds everything...

you sound indeed confused

two examples:

European Union exports to China 2010 ....................€ 127 billion

China Exports to European Union 2010....................€ 235 billion

U.S. exports to China 2010.......................................€ 77 billion

China exports to U.S. 2010.......................................€ 215 billion

The balance of trade as shown above. If it were roughly equal between nations then everyone would be happy but if it continues like this, problems lie ahead. Is there anywhere where China imports more than its exports with with figures like thise above?

China is fast becoming the worlds banker, holding those balances. They cannot call them in easily people they wont be paid, the countries dont have the money. We run our own household budgets to balance or run a small surplus and we are happy, countrys it seems dont do that because they tax us more for the difference and borrow, hope to pay back tomorrow and hope tomorrow never comes ( in their lifetime).

The monetary system as we know it is not a good one and it could very easily colapse, the patches that being put on the Euro will need to be strong, its going to cost but at least we can trundle along again for a bit. It certainly is not going to be good for Farang or anyone else for that matter.

[farang000999]

so china could easily shift have of it's production capacity to making things that it's own people wish to consume. this stuff about how they need us to buy from them is silly.

[nong38]

so china could easily shift have of it's production capacity to making things that it's own people wish to consume. this stuff about how they need us to buy from them is silly.

I dont think a lot of what they export could easily be diverted to the internal market and even if it could they will get a higher price from western countries so at this moment in time its not going to happen. If the West type economies suddenly cancelled all orders from China, then the ----would hit the fan. It would not be long before their economy started to contract,yes, some products be taken into the internal market, some products more in tune with the Chinese lifestyle might start to appear but in the mean time a lot less people are going to have jobs and then a lot less money in the system.....ah time to cash in some of the bonds we bought from USA and EUROLAND ( could you come next year?) India could be the next China, it could all be passed on to India, there will soon be more people living there than in China, so perhaps that is the way the future will unfold but after India where next, there in lies the long term problem, the world has until then to sort out the financial mess. I dont expect to be around when that time comes but I think I would make sure I had physical assets that are important by then, starting with a house which did not flood!

[farang000999]

so the Chinese do not want lap tops, play stations, xbox, iphone, cell phone, cpu, lcd tv, computer monitors, automobiles, airplanes, stereos, ipads, ipods, etc? the only people who are interested in these things are living in the West? If it were not for the West what would happen to all this excess production? Would they build it and then burn it? Shoot it off to outer space?

[nong38]

so the Chinese do not want lap tops, play stations, xbox, iphone, cell phone, cpu, lcd tv, computer monitors, automobiles, airplanes, stereos, ipads, ipods, etc? the only people who are interested in these things are living in the West? If it were not for the West what would happen to all this excess production? Would they build it and then burn it? Shoot it off to outer space?

Well they are not buying the products you mention in large volumes which is why their internal consumption is not anywhere near as high as it should be, most it is ear marked for export.

Perhaps you can tell me of a a chinese motor manufacturer and airplane manufacturer?. Apple 'I' products in this area are built in Taiwan not in China. I mentioned digital radios, digital radio is spreading through the western world but I have seen no evidence of it in this part of the world. Why would they want to build and products that have no market? China will build anything you want at whatever price you want to pay if they have a guaranteed market for it, whether you like it or not the focus is on the external ( export ) market like most countries, what is available on ther internal market is not the same as what is going out in containers, there is a big quality differential.

[farang000999]

if the USA and Europe disappeared they will not stop making computers and iphones. The production will continue. Prices will be lowered. More Chinese will be walking around with iphones the same way every American owned a microwave thirty years ago. Americans and Europeans are desperately holding onto these ridiculous theories that their role in the global market is to consume. And yes, almost everything or parts of everything is made in China. LOL @ differentiating between Taiwan. Including Airbuses. Again, if you have the ability to produce than you have the ability to consume. Our current global bubble is the Euro/USD.

[nong38]

if the USA and Europe disappeared they will not stop making computers and iphones. The production will continue. Prices will be lowered. More Chinese will be walking around with iphones the same way every American owned a microwave thirty years ago. Americans and Europeans are desperately holding onto these ridiculous theories that their role in the global market is to consume. And yes, almost everything or parts of everything is made in China. LOL @ differentiating between Taiwan. Including Airbuses. Again, if you have the ability to produce than you have the ability to consume. Our current global bubble is the Euro/USD.

China only produces military aircraft, currently, they do not build any 'I' products, they buy them yes but they dont produce them. I am not banging on about ridiculous theories about the USA and Europe the fact is that the west consumes and China produces for them simple as that. The west if its honest dont need to consume a lot of that stuff, they are convinced they have to have it and so the world goes round. Few people seem ask themselves its nice but do I really need it? Thais are the same, look at the number of new or number of forms of transport they have, where do they get the money, why do they need 2,3,4 or 5 form of transport? Is it a status thing, Possession thing? How much do they owe? The global bubble as you call it is real but neither of these currencies can be allowed to fail, it wont help the Chinese, they are holding the debt in bonds, or anyone else. 20 or 30 years ago the Chinese were riding around on pushbikes, now and for sometime its been cars, they are evolving quick, prices are going up with wages and before long they will be moving into a developed country status, at this time their economic position will be at risk of being undercut by India. Until that time the Chinese will try and build up their home market to better balance the economy.

[Naam]

nong38 said:

Perhaps you can tell me of a a chinese motor manufacturer and airplane manufacturer?

Since September 2011, the People's Republic of China has been the largest automotive market in the world.[1][2][3] China's automobile industry has been in rapid development since the early 1990s. In 2009, China produced 13.79 million automobiles, of which 8 million were passenger cars (sedans, sport utility vehicles (SUV), multi-purpose vehicles (MPV) and crossovers), and 3.41 million were commercial vehicles (buses, trucks, and tractors). Of the automobiles produced, 44.3% are local brands (BYD, Lifan, Chang'an (Chana), Geely, Chery, Hafei, Jianghuai (JAC), Great Wall, Roewe, etc.), the rest being produced by joint ventures with foreign car makers such as Volkswagen, Mitsubishi, General Motors, Hyundai, Nissan, Honda, Toyota etc. Most of the cars manufactured in China are sold within China, with only 369,600 cars being exported in 2009.

Transport aircraft manufactured in China

Y-5 Shijiazhuang Copy of An-2

Y-6 Il-14

Y-7 Xi'an Copy of An-24

Y-8 Shaanxi Copy of An-12

Y-9 Shaanxi Multi-purpose transport, in development and variant of the Y-8 (as Y-8X)

Y-11 Harbin 7 seats utility aircraft

Y-12 Harbin 17 seats utility aircraft

MA-60 Xi'an 60 seats turboprop-powered airliner, upgrade version of Y-7

MA-600 Xi'an 60 seats turboprop-powered airliner, upgrade version of MA-60

MA700 Xi'an 70-to-80 seats turboprop-powered airliner, to be introduced in 2009

ARJ-21 ACAC 70-90 seats advanced regional jet airliner, in development

C919 COMAC 168-190 seat twin-jet airliner, in development

Airbus A320 Airbus Chinese built version of the European Airbus A320, introduced 2009

you are welcome!

[farang000999]

The way I see it, it has nothing to do with Americans wanting stuff they don't need. Everyone in every country wants stuff they don't need, this includes the Chinese. Watch some of the great chinese documentaries out like "Last Train Home" and "Up The Yangtze".. There is always demand. This is the problem with Keynesian economic theory. They claim that the gov needs to stimulate to create demand. As if anytime people are not buying enough consumer goods that is a bad thing. They focus on demand, not supply.

Again, look at my example of the USA and Europe getting flooded and disappearing off the earth. They just vanish for the sake of discussion. Does China start closing factories and ending production? No they do not. They can keep producing these products and simply lower the price so that there own people can enjoy them. Here is Peter Schiff with some similar ideology:

We're the exact opposite. There's no way that we can get off as easy as Japan, because we're a mess. We're the world's biggest debtor. We have a huge trade deficit, we have no domestic savings, and we're already loaded up with debt. And the only hope we have of artificially stimulating our economy is that we borrow the money from the rest of the world. We don't have it on our own.

So, when the world stops financing this, it's going to come to an end and we're going to have to make these hard choices. Is it going to be hyperinflation or are we going to do the right thing?

But the rest of the world —and a lot of people think this, I've had a lot of arguments, people call it decoupling: "Well, this is never going to happen," or, "When America stops consuming, the whole world is finished."

They're not finished. We're not the engine of the world's economy, we're the caboose. And if you decouple the caboose, the cars move faster. We're not doing the world any favors consuming their stuff. It's just vendor financing. But people say we're the best customer. We're not; we're the worst customer, because we don't pay. A good customer pays you. And in the world of trade, you pay for imports with exports. And if you don't have anything to export, you can't pay, and that's what we have. We issue an IOU.

And when the world finally lets the dollar collapse — and they will — our purchasing power isn't going to vanish, it's just going to be redistributed. Other currencies are going to rise. And people in other countries, people that are working in factories right now in China, that are producing products and just shipping them abroad and just kind of waving good-bye, all of a sudden, they'll be able to afford them.

The Chinese will be able to turn in their bicycles and buy automobiles because steel will be cheaper, because cars will be cheaper, because the value of their wages will rise because their currency will gain purchasing power.

Edited November 7, 2011 by farang000999

[Naam]

The Chinese will be able to turn in their bicycles and buy automobiles because steel will be cheaper, because cars will be cheaper, because the value of their wages will rise because their currency will gain purchasing power.

and then they'll live happily ever after and now let's leave science fiction and return to reality

[nong38]

The way I see it, it has nothing to do with Americans wanting stuff they don't need. Everyone in every country wants stuff they don't need, this includes the Chinese. Watch some of the great chinese documentaries out like "Last Train Home" and "Up The Yangtze".. There is always demand. This is the problem with Keynesian economic theory. They claim that the gov needs to stimulate to create demand. As if anytime people are not buying enough consumer goods that is a bad thing. They focus on demand, not supply.

Again, look at my example of the USA and Europe getting flooded and disappearing off the earth. They just vanish for the sake of discussion. Does China start closing factories and ending production? No they do not. They can keep producing these products and simply lower the price so that there own people can enjoy them. Here is Peter Schiff with some similar ideology:

We're the exact opposite. There's no way that we can get off as easy as Japan, because we're a mess. We're the world's biggest debtor. We have a huge trade deficit, we have no domestic savings, and we're already loaded up with debt. And the only hope we have of artificially stimulating our economy is that we borrow the money from the rest of the world. We don't have it on our own.

So, when the world stops financing this, it's going to come to an end and we're going to have to make these hard choices. Is it going to be hyperinflation or are we going to do the right thing?

But the rest of the world —and a lot of people think this, I've had a lot of arguments, people call it decoupling: "Well, this is never going to happen," or, "When America stops consuming, the whole world is finished."

They're not finished. We're not the engine of the world's economy, we're the caboose. And if you decouple the caboose, the cars move faster. We're not doing the world any favors consuming their stuff. It's just vendor financing. But people say we're the best customer. We're not; we're the worst customer, because we don't pay. A good customer pays you. And in the world of trade, you pay for imports with exports. And if you don't have anything to export, you can't pay, and that's what we have. We issue an IOU.

And when the world finally lets the dollar collapse — and they will — our purchasing power isn't going to vanish, it's just going to be redistributed. Other currencies are going to rise. And people in other countries, people that are working in factories right now in China, that are producing products and just shipping them abroad and just kind of waving good-bye, all of a sudden, they'll be able to afford them.

The Chinese will be able to turn in their bicycles and buy automobiles because steel will be cheaper, because cars will be cheaper, because the value of their wages will rise because their currency will gain purchasing power.

This an interesting theory, sounds good, but its not the world I recognize. Yes the west is heavily in debt and the people who own the debts are the Chinese but they can nevr call them in for the reasons they are not going to get paid and their own economy would colapse.

The world you see and the one I see are not the same, I am not going to be able to convince about the one I see is the right one and you are not going to convince me of yours. It sounds good but its not going to happen, the global powers are not going to let it happen. There are global conglomerates who have a huge market share of their sector, they have won it and they are going to make sure they hold on to that, eg Coca Cola. There huge financial conglomerates ( whether independent or nation states financial interests ) who are not going to allow the theories you have shown us come to fruition, unless it suits them and now I dont see it.

Going back to the original question a europe defalut would not be great for farang or anyone and I see today that one German company TUI wants to re draft its agreement on settlement currencies with Greek outfits to pay them in Dracma if they leave the EU because the currency would colapse, or is it a ploy to pull them into the real world and accept the tough times?

[nong38]

nong38 said:

Perhaps you can tell me of a a chinese motor manufacturer and airplane manufacturer?

Since September 2011, the People's Republic of China has been the largest automotive market in the world.[1][2][3] China's automobile industry has been in rapid development since the early 1990s. In 2009, China produced 13.79 million automobiles, of which 8 million were passenger cars (sedans, sport utility vehicles (SUV), multi-purpose vehicles (MPV) and crossovers), and 3.41 million were commercial vehicles (buses, trucks, and tractors). Of the automobiles produced, 44.3% are local brands (BYD, Lifan, Chang'an (Chana), Geely, Chery, Hafei, Jianghuai (JAC), Great Wall, Roewe, etc.), the rest being produced by joint ventures with foreign car makers such as Volkswagen, Mitsubishi, General Motors, Hyundai, Nissan, Honda, Toyota etc. Most of the cars manufactured in China are sold within China, with only 369,600 cars being exported in 2009.

Transport aircraft manufactured in China

Y-5 Shijiazhuang Copy of An-2

Y-6 Il-14

Y-7 Xi'an Copy of An-24

Y-8 Shaanxi Copy of An-12

Y-9 Shaanxi Multi-purpose transport, in development and variant of the Y-8 (as Y-8X)

Y-11 Harbin 7 seats utility aircraft

Y-12 Harbin 17 seats utility aircraft

MA-60 Xi'an 60 seats turboprop-powered airliner, upgrade version of Y-7

MA-600 Xi'an 60 seats turboprop-powered airliner, upgrade version of MA-60

MA700 Xi'an 70-to-80 seats turboprop-powered airliner, to be introduced in 2009

ARJ-21 ACAC 70-90 seats advanced regional jet airliner, in development

C919 COMAC 168-190 seat twin-jet airliner, in development

Airbus A320 Airbus Chinese built version of the European Airbus A320, introduced 2009

you are welcome!

Learn something new everyday!

[Naam]

Learn something new everyday!

Nong,

no matter what age we are... once we to stop learning, be it by refusal or capability, we are doomed :jap:

[waza]

The way I see it, it has nothing to do with Americans wanting stuff they don't need. Everyone in every country wants stuff they don't need, this includes the Chinese. Watch some of the great chinese documentaries out like "Last Train Home" and "Up The Yangtze".. There is always demand. This is the problem with Keynesian economic theory. They claim that the gov needs to stimulate to create demand. As if anytime people are not buying enough consumer goods that is a bad thing. They focus on demand, not supply.

Again, look at my example of the USA and Europe getting flooded and disappearing off the earth. They just vanish for the sake of discussion. Does China start closing factories and ending production? No they do not. They can keep producing these products and simply lower the price so that there own people can enjoy them. Here is Peter Schiff with some similar ideology:

We're the exact opposite. There's no way that we can get off as easy as Japan, because we're a mess. We're the world's biggest debtor. We have a huge trade deficit, we have no domestic savings, and we're already loaded up with debt. And the only hope we have of artificially stimulating our economy is that we borrow the money from the rest of the world. We don't have it on our own.

So, when the world stops financing this, it's going to come to an end and we're going to have to make these hard choices. Is it going to be hyperinflation or are we going to do the right thing?

But the rest of the world and a lot of people think this, I've had a lot of arguments, people call it decoupling: "Well, this is never going to happen," or, "When America stops consuming, the whole world is finished."

They're not finished. We're not the engine of the world's economy, we're the caboose. And if you decouple the caboose, the cars move faster. We're not doing the world any favors consuming their stuff. It's just vendor financing. But people say we're the best customer. We're not; we're the worst customer, because we don't pay. A good customer pays you. And in the world of trade, you pay for imports with exports. And if you don't have anything to export, you can't pay, and that's what we have. We issue an IOU.

And when the world finally lets the dollar collapse and they will our purchasing power isn't going to vanish, it's just going to be redistributed. Other currencies are going to rise. And people in other countries, people that are working in factories right now in China, that are producing products and just shipping them abroad and just kind of waving good-bye, all of a sudden, they'll be able to afford them.

The Chinese will be able to turn in their bicycles and buy automobiles because steel will be cheaper, because cars will be cheaper, because the value of their wages will rise because their currency will gain purchasing power.

This an interesting theory, sounds good, but its not the world I recognize. Yes the west is heavily in debt and the people who own the debts are the Chinese but they can nevr call them in for the reasons they are not going to get paid and their own economy would colapse.

The world you see and the one I see are not the same, I am not going to be able to convince about the one I see is the right one and you are not going to convince me of yours. It sounds good but its not going to happen, the global powers are not going to let it happen. There are global conglomerates who have a huge market share of their sector, they have won it and they are going to make sure they hold on to that, eg Coca Cola. There huge financial conglomerates ( whether independent or nation states financial interests ) who are not going to allow the theories you have shown us come to fruition, unless it suits them and now I dont see it.

Going back to the original question a europe defalut would not be great for farang or anyone and I see today that one German company TUI wants to re draft its agreement on settlement currencies with Greek outfits to pay them in Dracma if they leave the EU because the currency would colapse, or is it a ploy to pull them into the real world and accept the tough times?

I lived in China for 6 months last year and no one rode bicycles, the main mode of transportation was electric scooter, then petrol scooter, motorbike and cars, but trucks outnumber them all. Public transport is king over large distances. There are plenty of I product being manufacture there but all are fake. I once read a study that said is every Chinese house hold had a fridge, the polution created building them would wipe out the ozone layer.

Edited November 8, 2011 by waza

[cloudhopper]

http://globaleconomicanalysis.blogspot.com/2011/11/france-germany-have-intense.html

[Naam]

http://globaleconomicanalysis.blogspot.com/2011/11/france-germany-have-intense.html

"The message here is simple: If you are in Euros, get the hell out." (Mike "Mish" Shedlock)

yeah right Mish! and then... become a registered investment advisor representative for Sitka Pacific Capital Management and comment rumours allegedly spread by "unnamed senior EU officials"?

[cloudhopper]

Another entertaining Farage rant - http://globaleconomicanalysis.blogspot.com/2011/11/i-want-you-all-fired-yet-another.html

[nong38]

Now the focus seems to be drawing in Italy as well now and another wonderful way to run the economy, but now they need to sit up and take notice and sort out there problems which they have been pushing away for years. They have still to ratify their last two annual budgets can you believe that. This house really needs putting in order, if we thought Greece was bad and needed lots of money then Italy is in the top 10 world economies I understand. It really is to big for the rest to bail out. They have to sort this out themselves and the time is now.

Its been a great life along the Med for a few years now but the knock on the door from the Tallyman is imminent.

Edited November 13, 2011 by nong38