Another sad but amazing story between China and America business

[BTravlin]

China doesn't have a call-center industry. That would be India and the Philippines.

True, I mainly posted that because someone earlier referenced call center jobs going overseas.

However, along the same lines, China's economy is growing quickly and employment costs are also rising quickly and our currency value is falling. These factors along with others will cause China to lose business to other countries and some of that business will return to the U.S. Capitalism and market forces have a way of balancing things out over time. They don't say patience is a virtue for nothing though.

 

[stoutboy]

What countries will China lose business to? Chinese wages are rising, but they are still vastly lower than the US, so I don't see how any of those jobs will return here. More likely, they are gone for good. Vietnam will get them, most likely--a lot of Chinese manufacturing jobs are already headed there. But the Chinese are investing heavily in Vietnam, and all throughout ASEAN (and Africa, for natural resources). Also, domestic demand within China will more than make up for the shavings of percentage points it will lose to tiny economies like Vietnam. China still has a LOT of room to grow.

My advice is to find a Chinese index fund and buy, buy, buy.

True, I mainly posted that because someone earlier referenced call center jobs going overseas.

However, along the same lines, China's economy is growing quickly and employment costs are also rising quickly and our currency value is falling. These factors along with others will cause China to lose business to other countries and some of that business will return to the U.S. Capitalism and market forces have a way of balancing things out over time. They don't say patience is a virtue for nothing though.

 

[BTravlin]

Vietnam, as you mentioned, for one. Also, Indonesia, Malaysia, Thailand, Laos and maybe one day Pakistan if they ever get their act together. There will always be lower cost options that present themselves and capital will chase those options. I did say patience would be needed as it won't happen overnight.

 

[stoutboy]

I can't see China losing too much business to Thailand, or frankly, to any ASEAN country. In fact, in the Thai case, it will likely be the other way around, after the ASEAN-China Free Trade Agreement fully takes effect.

All Laos has is natural resources, and the Chinese are buying those up for a song. Laos could conceivably become a niche manufacturing zone, but realistically it is just too small to have much of an impact.

Cambodia has some promise though--but again, I think the future in SE Asia is Vietnam, at least for the next two decades.

Vietnam, as you mentioned, for one. Also, Indonesia, Malaysia, Thailand, Laos and maybe one day Pakistan if they ever get their act together. There will always be lower cost options that present themselves and capital will chase those options. I did say patience would be needed as it won't happen overnight.

 

[M Paquette]

Neal Stephenson said is best in Snow Crash (1992)

When it gets down to it — talking trade balances here — once we've brain-drained all our technology into other countries, once things have evened out, they're making cars in Bolivia and microwave ovens in Tadzhikistan and selling them here — once our edge in natural resources has been made irrelevant by giant Hong Kong ships and dirigibles that can ship North Dakota all the way to New Zealand for a nickel — once the Invisible Hand has taken away all those historical inequities and smeared them out into a broad global layer of what a Pakistani brickmaker would consider to be prosperity — y'know what? There's only four things we do better than anyone else:
music
movies
microcode (software)
high-speed pizza delivery

 

[Nords]

Neal Stephenson said is best in Snow Crash (1992)

Yeah, but I still want one of those damn skateboards...

 

[JOHNNIE36]

China is starting to have their "problems" also due to their thriving economy. Saw a documentary the other night about the trash problem in China. They are starting to consume so much more that the country is being overwhelmed by the trash and they are starting to "export" it. Also, saw that Donald Trump is calling for China to get their monetary system in order. Everything is so underpriced it's getting stupid. They aren't in the ballpark (or we aren't in theirs) when it comes to competing in price. He's angry and is talking about running for the presidency because of the China threat
to the economic collapse of our country.

 

[NW-Bound]

So? Panda Express is a fast-food chain, so all the dishes are prepared according to preset recipes. Once the cook gets the right ingredients and the right seasoning, it will taste "authentic". My daughter, when in high school, worked as a hostess at a local Chinese restaurant. The owner was Chinese, but all the cooks were Mexican.

I remember watching on FoodTV a show where Anthony Bourdain, a celebrity French cuisine chef, went back to visit the restaurant where he was head chef. In his place, they had promoted an immigrant Mexican who used to be his helper. This new chef had no formal training and learned to cook on the job. Anthony said the guy's cooking was just like any formally trained French chef.

But, an irony I experienced was going to a Panda Express for some fast food Chinese food and none of the workers were Chinese. The workers there looked like they could have easily been flipping hamburgers at a hamburger joint.

But the food actually tasted "authentic" like what one would get at a Chinese take-out place. Go figure

That food tasted "authentic" only because most Chinese food in the US is not authentic at all. (Thankfully, though, becoming more so). A lot of the chefs at Chinese restaurants nowadays are actually Hispanic. I've run across a few that spoke excellent Chinese considering they learned it entirely in the restaurants.

Yes. Talk about authentic, is one sure he can handle "authentic"?

I have been to many Chinatowns to have meals, like in San Francisco, Los Angeles, Seattle, NYC, Boston, Philadelphia, Honolulu, Sidney, Montreal, etc... I enjoyed the food, but was the food authentic? Yes, it should be as I ate it alongside the local ethnic Chinese, but I suspect that the food eaten by the Chinese living abroad is not quite the same as the "authentic" food eaten in mainland China, which I have not been to.

The above was not to denigrate Chinese cuisine. Not at all! Every country, or actually region, has some peculiar dishes that would not be enjoyed by "foreigners". I remember a show where Alton Brown (host of the Good Eats show on FoodTV) visited a town somewhere in the Midwest, and ate a fried cow brain sandwich. Now, I can handle that, if nobody reminds me of mad cow disease, but I am sure many of you here can't.

China still has a LOT of room to grow...My advice is to find a Chinese index fund and buy, buy, buy.

Remembering that China is still not a free country (do they have any political party other than the Communist party?), I prefer to invest in companies and countries that sell to them.

...(Donald Trump) is angry and is talking about running for the presidency because of the China threat to the economic collapse of our country.

My initial reaction was "OMG! President Trump!" But then, thinking about it, strange things have happened before. Every time the populace got frustrated, it wanted to try something different. And who knows what will work or will not?

I will keep investing in foreign companies and US companies that have foreign trade exposures. What else for a guy to do?

 

[dex]

I did a bicycle trip in China in '85 or '86 in the eastern part between Shanghai and Beijing. Also, I lived in HK. The food we eat here is nothing like what you get in China - except for the Dim Sum.

 

[ERD50]

Along these same lines, we often eat 'edamame', which is a green (often in the pod) soybean. A friend of mine pointed out that they mostly come from China. We grow plenty of soybeans right here in IL and other parts of the US. Why do we import these from China? I really don't understand that.

When I was a kid, we sometimes got the dried soybeans from a neighbors farm - they are kinda nutty-popcorn like if you dry pan fry them just right.

I am going to tell my kids to take Chinese as a second language in school, just in case, we might be working for them in the future.

enuff

In the 70's everyone said that about Japanese.

-ERD50

 

[NW-Bound]

The food we eat here is nothing like what you get in China.

But which do you prefer?

My friends liked to go to P.F.Chang whenever we wanted Chinese food. I went along, but told them that it was not authentic. They said "True, but this is better". You just cannot argue about someone's personal taste.

 

[Spanky]

But which do you prefer?

My friends liked to go to P.F.Chang whenever we wanted Chinese food. I went along, but told them that it was not authentic. They said "True, but this is better". You just cannot argue about someone's personal taste.

Agreed. Taste is personal. I would not go to P.F. Chang when there are so many authentic Chinese restaurants in my area.

 

[stoutboy]

Interesting post. If I have one quibble, it would be your comment that you would not invest in a Chinese index because China is not 'free' (btw, they do have other political parties); instead, you invest in foreign companies that sell to them.

In the first place, there are different ways of looking at freedom. In China, people do not enjoy substantial political freedom, true, but they do enjoy significant economic freedom. If I were a foreign investor in China, I would be more concerned about the latter.

Second, even if your argument is valid, you gain little by your method. The foreign companies you invest in are beholden to Chinese law when they establish a presence there to do business. If you invest in them, and their business takes a hit for whatever reason, you still are on the hook.

China is just too big too ignore. What other country of that size has enjoyed 8% or more growth for so many years (now at least 25 years)? And it still has room to grow--particularly its domestic economy. I think a Chinese index fund would just be a no-brainer. I've found some, but their ERs seem rather high. I hope Vanguard or Fidelity create one. We are really missing out.

So? Panda Express is a fast-food chain, so all the dishes are prepared according to preset recipes. Once the cook gets the right ingredients and the right seasoning, it will taste "authentic". My daughter, when in high school, worked as a hostess at a local Chinese restaurant. The owner was Chinese, but all the cooks were Mexican.

I remember watching on FoodTV a show where Anthony Bourdain, a celebrity French cuisine chef, went back to visit the restaurant where he was head chef. In his place, they had promoted an immigrant Mexican who used to be his helper. This new chef had no formal training and learned to cook on the job. Anthony said the guy's cooking was just like any formally trained French chef.





Yes. Talk about authentic, is one sure he can handle "authentic"?

I have been to many Chinatowns to have meals, like in San Francisco, Los Angeles, Seattle, NYC, Boston, Philadelphia, Honolulu, Sidney, Montreal, etc... I enjoyed the food, but was the food authentic? Yes, it should be as I ate it alongside the local ethnic Chinese, but I suspect that the food eaten by the Chinese living abroad is not quite the same as the "authentic" food eaten in mainland China, which I have not been to.

The above was not to denigrate Chinese cuisine. Not at all! Every country, or actually region, has some peculiar dishes that would not be enjoyed by "foreigners". I remember a show where Alton Brown (host of the Good Eats show on FoodTV) visited a town somewhere in the Midwest, and ate a fried cow brain sandwich. Now, I can handle that, if nobody reminds me of mad cow disease, but I am sure many of you here can't.



Remembering that China is still not a free country (do they have any political party other than the Communist party?), I prefer to invest in companies and countries that sell to them.



My initial reaction was "OMG! President Trump!" But then, thinking about it, strange things have happened before. Every time the populace got frustrated, it wanted to try something different. And who knows what will work or will not?

I will keep investing in foreign companies and US companies that have foreign trade exposures. What else for a guy to do?

 

[GusLevy]

China Herald: My friends, what do you want from us?

Calafia Beach Pundit: Pity the Chinese

IMO much of the Americans' (and the West in general) fears and apprehensions concerning the growing Chinese economic and political strength is due to good ole fashioned xenophobia.

I hope that the links above work - the first is a great poem written from the Chinese cultural perspective while the second is the thoughtful way to view the economic relationship between the USA and China. I suspect that this entire thread will be turned upside down after reading Grannis' article.

 

[Sam]

China Herald: My friends, what do you want from us?

Ha ha ha... Excellent poem! Thanks.

What do you want from us?

When we were called “sick man of Asia”, we were called peril.
When we billed to be the next superpower, we’re called the threat

When we closed our doors, you smuggled drugs to open markets.
when we embrace free trade, you blame us for taking away your jobs.

when we’re falling apart, you marched in your troops and wanted your fair share.
when we’re putting the broken pieces together, “Free Tibet” you screamed! “it was invasion.”

So we tried communism, you hated us for being communist.
So we embraced capitalism, you hate us for being capitalist,

Then we have a billion people, you said we’re destroying the planet.
Then we limit our numbers, you said it was human rights abuses.

When we were poor, you think we’re dogs,
When we loan you cash, you blamed us for your debts.

When we build our industries, you called us polluters.
When we sell you goods, you blamed us for global warming,
When we buy oil, you called that exploitation and genocide.

When we were lost in chaos and rampage, you wanted rule s of laws for us.
When we uphold law and order against violence, you called that violation of human rights.

When we were silent, you said you want us to have free speech.
When we were silent no more, you say we were brainwashed.

Why do you hate us so much? We asked. “No”. You answered, “we don’t hate you”.
We don’t hate you either Bud, do you understand us?? “of course we do”, you said, “We have CNN, BBC, and CBC”.

But why, we still feel, your western people are not happy with us.

What do you really want from us??

My friend, What do you really want from us??

 

[NW-Bound]

I just remembered 4 more places where I have visited their Chinatowns: Vancouver, Victoria, Toronto, and Chicago.

Agreed. Taste is personal. I would not go to P.F. Chang when there are so many authentic Chinese restaurants in my area.

I have not been to Minneapolis, but when I do, will visit its Chinatown too. You can tell I like Chinese food. Well, I like all kinds of food.

... (btw, they do have other political parties)..

Really! Perhaps someone else will chime in to inform us, but I thought what is common with the few remaining Communist countries in the world is that the citizens can vote for anyone they want, as long as the candidate is from the Communist Party.

To each his own. About investing in China, its local economy has a lot of room to grow. By investing in companies and countries that export commodities to China, I can participate enough in that.

IMO much of the Americans' (and the West in general) fears and apprehensions concerning the growing Chinese economic and political strength is due to good ole fashioned xenophobia.

I hope that the links above work - the first is a great poem written from the Chinese cultural perspective while the second is the thoughtful way to view the economic relationship between the USA and China. I suspect that this entire thread will be turned upside down after reading Grannis' article.

The Chinese are hard workers, no doubt about that. Among my friends, we do not begrudge their success, and often say that they have slowly become capitalists, while we are slipping more to the left. In the 60s and 70s, factories in China and the Soviet Bloc had such low outputs because the workers spent more time to talk about work than doing actual work. Sadly, the Chinese have learned to work more and talk less, while in the US, companies are spending more time for BS like touchy-feely stuff and slogans.

Still, I have jaundiced eyes towards any country that does not give its citizenry true political freedom, and where a dissident can be thrown in jail for voicing opposition, and not kowtowing to the leaders. In fact, I maintain a personal policy of not even visiting those countries. I do not follow politics in the Far East, but have read that neighboring countries of China have grown a bit weary of its military might.

 

[obgyn65]

I am afraid we, as a nation, already work for them as they own our debt...

just in case, we might be working for them in the future.

enuff

 

[Sam]

... I do not follow politics in the Far East, but have read that neighboring countries of China have grown a bit weary of its military might.

I'm quite certain ALL countries on earth are weary of the USA military might.

 

[stoutboy]

...I do not follow politics in the Far East, but have read that neighboring countries of China have grown a bit weary of its military might...

Yeah, the Chinese are pretty bad that way--consistently invading sovereign states and/or using their intelligence service to topple democratically elected, but 'unfriendly' regimes. Oh wait...

 

[bdk]

neighboring countries of China have grown a bit weary of its military might.

Did you mean "wary"? Both words make sense in this context, but I think "wary" would be more appropriate here.

 

[NW-Bound]

Hey, we have a lively little discussion going on here. One never knows when posting that there will be anyone reading his ramblings.

I'm quite certain ALL countries on earth are weary of the USA military might.

Gee whiz, it's tough to be the world cop. Damned if you do, damned if you don't. Whenever there was some genocide going on in the world, nearly every humanitarian looked to the US to intervene. Who else are they going to call? Sometimes the intervention worked, like in Kosovo. Most other times it did not. It's a love and hate relationship with the US, the same as with the police patrolling your neighborhood.

Sigh...If these little countries would just behave, then no one would get hurt.

Yeah, the Chinese are pretty bad that way--consistently invading sovereign states and/or using their intelligence service to topple democratically elected, but 'unfriendly' regimes. Oh wait...

Umm... If you try to use some non-violent means, you still get in trouble. Boy, it's just not fair. If you cannot topple some despots by a bit of subversion, who are you going to topple?

OK, enough jesting around. I am no student of politics, or foreign relations, but I think all countries have spies and do dirty deeds. If it's the game that people play around the world, can you opt out and not do what everyone does? I do not know.

But while the US is no saint, whatever its government does, its people will eventually know. There are always leaks and whistle blowers. On the other hand, about China, don't they still have firewalls on the Internet to block all information on the Tiananmen Square event? The US is far from a perfect place, but it is still better than many other places, China included.

Did you mean "wary"? Both words make sense in this context, but I think "wary" would be more appropriate here.

I believe SE Asian countries have been "aware" of the Chinese dominance in the region for many years, acutely more so after the demise of the Soviet Empire. Have there been some border skirmishes, and more recently disputes over some small islands in the region? Will there be another Tibet?

As far back as 10 years ago, I happened to read a published article somewhere that SE Asian countries liked to get back the US presence in the area, mainly to keep China in check. Was that true, or was it propaganda by some American imperialists who wanted to get back there? What China's neighbors really want, I do not know as I do not live there, but about the US coming back, that is just not going to happen.

Anyway, let's hope that everybody is so busy working that they don't have time to stir up trouble. "Make money, not war". That gets us back to the economy discussion. Yes, I don't begrudge the Chinese their success. They work too damn hard. The right way to get ahead, either as a nation or as individuals, is to work hard and or smart. As the Chinese already work pretty hard, it is going to be tough to beat them on that aspect. Americans must work harder on the smart part. Oops, I used the word h*rd again.

 

[Sam]

... I do not follow politics in the Far East, but have read that neighboring countries of China have grown a bit weary of its military might.

I'm quite certain ALL countries on earth are weary of the USA military might.

Gee whiz, it's tough to be the world cop.

...

Sigh...If these little countries would just behave, then no one would get hurt.

I did not detect any sarcasm so you must be very serious. I can't recall an election where the USA was elected to be the world cop.

I agree with you that some little countries do not behave well, but is this big country, the USA, behaving?

 

[target2019]

<begin rant>
We're simply fat and happy, propped up by numerous tax advantages, not willing to work until we die. The gov't takes care of us, and we whine when our benefits are lowered. When our pumkin seeds are transported thousands of miles, instead of a few hundred, we complain, not recognizing the long trail of regulations that makes that possible. Our problems stem from lack of education. Our attention is on Tweedle-Dee and Tweedle-Dum, and we give in to quick fixes. Many of us never studied the constitution, but that is not necessarily an impediment to running for public office, is it? We are destroying ourselves. The USSR, the terrorist, the Chinese--these are all distractions, or have been. We have no one to blame for this situation but ourselves.
</end rant>

 

[BTravlin]

<begin rant>We have no one to blame for this situation but ourselves.
</end rant>

Agreed. Apathy and ignorance make for a lethal combination.

 

[Ed_The_Gypsy]

I don't know and I don't care.