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Old 08-08-2012, 05:36 PM   #21
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I would say that Japanese industry has certainly lost the apparent edge it had in the 1980's.

Their auto companies are no longer head and shoulders above the rest of the world.

Sony is facing a shift of most of its large markets that may very well destroy it.

In the 80's it looked like Japan would be the world's manufacturing leader.

That no longer seems likely.
Perhaps. But how many of us prefer American cars to Japanese ones? Also, it should be remembered that Japan, an advanced country, faces the same headwind of all the other Western nations- a huge negative wage cost disparity. No Western country is going to be the world manufacturing leader, and perhaps I have just been taken in by Mr. Moynihan's sensationalism, but I believe that China will hold that position for most of the next 25 years anyway..

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SOunds a bit too sensitive to me Ha. I doubt any of us in the refrain see China as a paper tiger. But we do see "terrifying vision," "decline of the west" as media sensation.
Could be. Yet it seems a stretch to call a lecture delivered to graduate students at LSE "media sensation".

But as I said earlier, everyone makes his or her own bets. Bonne chance!

Ha
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Old 08-08-2012, 05:54 PM   #22
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Japan's nominal GDP is lower than it was 15 years ago. Where it once had global dominance or competitiveness it is now struggling. China has picked up some of that, but other countries, like Korea, have also gained competitiveness. There are many reasons for this. Wages are one, but not necessarily the most important.
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Old 08-08-2012, 05:57 PM   #23
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Japan's nominal GDP is lower than it was 15 years ago. Where it once had global dominance or competitiveness it is now struggling. China has picked up some of that, but other countries, like Korea, have also gained competitiveness. There are many reasons for this. Wages are one, but not necessarily the most important.
Well, whatever. Nevertheless, as I said earlier, I think much if the problem with Japan is not its maufacturers, but its banks and government.
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Old 08-08-2012, 06:51 PM   #24
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Well, whatever. Nevertheless, as I said earlier, I think much if the problem with Japan is not its maufacturers, but its banks and government.
Ok. Thanks for the clarification.
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Old 08-08-2012, 08:25 PM   #25
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One thing to keep in mind about China--

They have half our GDP with four times the people. So their GDP per capita is 1/8 of ours. Their growth has been on a pretty small base.

It remains to be seen whether they can keep growing without some massive social upheaval. It's easy to keep a nation of subsistence farmers under control. Their increased wealth may force political change. Or their government may choose control over growth.

I would be reluctant to try to predict what China will look like in 20 years. I think it is more or less unknowable at this point.

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Perhaps. But how many of us prefer American cars to Japanese ones? Also, it should be remembered that Japan, an advanced country, faces the same headwind of all the other Western nations- a huge negative wage cost disparity. No Western country is going to be the world manufacturing leader, and perhaps I have just been taken in by Mr. Moynihan's sensationalism, but I believe that China will hold that position for most of the next 25 years anyway..
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Old 08-08-2012, 08:42 PM   #26
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One thing to keep in mind about China--

They have half our GDP with four times the people. So their GDP per capita is 1/8 of ours. Their growth has been on a pretty small base.

It remains to be seen whether they can keep growing without some massive social upheaval. It's easy to keep a nation of subsistence farmers under control. Their increased wealth may force political change. Or their government may choose control over growth.

I would be reluctant to try to predict what China will look like in 20 years. I think it is more or less unknowable at this point.
Agree with your premise. I think that the history of the last half century or so has shown that there are some inherent advantages to the western style free democratic approach as it intersects with economic development, particularly in technological applications. (The internet would have never evolved in a communist environment). I'm old enough to remember back in the early 60"s how it seemed that the other side's economic system appeared at the time to have some advantages that would "bury us" well, we know how that turned out. In my opinion the system the Chinese have implemented of a sort of command economy with capitalistic free enterprise at a lower manufacturing level and few true democratic freedoms will prove to be ultimately unstable and less of a threat than we now think.
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Old 08-09-2012, 12:48 AM   #27
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One thing to keep in mind about China--

They have half our GDP with four times the people. So their GDP per capita is 1/8 of ours. Their growth has been on a pretty small base.

It remains to be seen whether they can keep growing without some massive social upheaval. It's easy to keep a nation of subsistence farmers under control. Their increased wealth may force political change. Or their government may choose control over growth.

I would be reluctant to try to predict what China will look like in 20 years. I think it is more or less unknowable at this point.
I would look out for political change at some point. As my wise FIL says " See,find,out"
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Old 08-09-2012, 07:48 AM   #28
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I've seen over the past thirty years a real change in attitudes here in the United States. I started out in the early 80s and back then people wanted to get rich. It was everyone's dream. There was no evil rich guy. People aspired to be like them. Now it's that rich CEO that's hording all the money and making people slaves. What a difference 30 years can make.
In the last 34 years CEO pay has increased over 700%, the average workers pay over the same time is just under 6%. I don't blame people for feeling the got the short end of the stick.

Crazy data point of the day: How much CEO pay vs. worker pay has grown - Post Leadership - The Washington Post
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Old 08-09-2012, 09:02 AM   #29
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In the last 34 years CEO pay has increased over 700%, the average workers pay over the same time is just under 6%. I don't blame people for feeling the got the short end of the stick.

Crazy data point of the day: How much CEO pay vs. worker pay has grown - Post Leadership - The Washington Post
What you say is right. But why are people picking extreme examples to make a comparison? Sport stars and entertainers also makes millions. You can just as easily compare yourself to someone in China or India who makes $100/month.
My point is that we (United States) have lost our competitive edge because we are no longer as driven or motivated as compared to other countries. Growing up I always though the carrot was attainable. I aimed high and only got half way there. Now it seems that people give up even before they start.
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Old 08-09-2012, 09:49 AM   #30
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I've seen over the past thirty years a real change in attitudes here in the United States. I started out in the early 80s and back then people wanted to get rich. It was everyone's dream. There was no evil rich guy. People aspired to be like them. Now it's that rich CEO that's hording all the money and making people slaves. What a difference 30 years can make.
Really? So noone can get rich unless you are a CEO? I know a fair number of millionaires that would disagree with that ALL seld-made, NONE are coporate types...........
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Old 08-09-2012, 11:03 AM   #31
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What you say is right. But why are people picking extreme examples to make a comparison? ...
The thing is, that study didn't take extremes, that was the average CEO pay. In my opinion, people are just as motivated as before, but they are also more cynical about the possibility.
They still want to attain wealth, they just believe the odds are stacked much more heavily against them.
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Old 08-09-2012, 12:40 PM   #32
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I'm much more optimistic about the West's and my children's prospects than most of the media. I've lived in Japan and worked closely with Chinese companies. Based on my experience I have the following opinions.
1) The West and particularly the U.S. cultural and legal system of free trade, patent protection, rule of law, and incentives for improving your way of life are a fundamental advantage over any government managed economy. I put Europe, China, India, and Japan in category of government managed. Its been my experience that free market economies are much more flexible than government managed ones. The government managed ones can do extremely well when their policies line up with prevailing winds (eg Japan in the 80's) but can't change direction well when times change. (eg Japan in the 2000's).
2) China has been growing quickly from a small base. I'm very worried about how they are going to transition from a high growth mode to a more sustainable way of life. They cannot afford the congestion, pollution, and resource requirements to raise all of their population to the U.S. mean. But, if they don't do this, their likely to have a revolution. The populace believe that they can improve their lives and are not going to take kindly to heavy handed attempts to slow down the growth. When the Chinese economic engine falters, it is going to have a ripple effect on the rest of the world. They are now "too big too fail."
3) I'm not particularly worried about China passing the U.S. So what if they do? The U.S. economy passed the UK's a long time ago and I don't think anyone would argue that the quality of life in UK is worse because the U.S. has a higher per capita GDP. I lived there for 5 years. In many ways, I enjoyed my life more then than where I'm living now near Chicago.
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