Flatlining GDP is Our Fault

dryhat

howee wrote: »

Have it your way China is fine they can just keep exporting and paying their workers low wages. Those houses, roads, airports don't need to be used it all counts towards GDP they will just carry on forever?

Or Look up Robert Peston 'is China the solution or the next big problem'

GL

I'm not arguing but ...

Robert f*cking Peston?
He either hasn't got a clue or is a liar just trying to keep his job.

Find a better commentator to support your case.

PaulF81

howee wrote: »

Err nope, how long do you think china can hold wages for workers in the export business down for? What do you think will happen when the workers want/desire the goods they are sending to us (the West?), will they continue to be happy with low wages? China needs to create a consumer society but the Chinese don't do debt they save.

As long as it takes to get their population under control. We better watch out after that!

sheffield_lad

I am no fan of the BBC but I don't mind the guy and he has been to China on several occations.

His argument is also logical, How long before the Chinese want Japanese motorbikes, Ipads (made in china), a taste of the west? If the Yuan is kept low exports great imports not so good. The wages in comparison to GDP have also fallen. An average family save around one quarter to one third of their monthly income which is great until you realise its for property or children's education NOT for consumer goods. If the roads, airports house building does dry up (and it will), they need the mother of all spending binges or GDP will fall, unemployment will rise and we really will be in the brown stuff.

GL

sheffield_lad

PaulF81 wrote: »

As long as it takes to get their population under control. We better watch out after that!

They also have an issue well known in the West

Old age and with the one child policy they may actually be in a worse position than the US or EU.

I guess that creates a job or two though lol

PaulF81

They can want it all they want. If its not in tune with what's right for china, they ain't getting it.

Don't like it? Get squished by tanks in public squares.

sheffield_lad

PaulF81 wrote: »

They can want it all they want. If its not in tune with what's right for china, they ain't getting it.

Don't like it? Get squished by tanks in public squares.

The issue is where profits are going, not into the pockets of workers but into the state and corruption is also rife. They don't have pension funds or share saves who reap any of the rewards and with more and more communication with the west it won't take long before there is a muttering of discontent. My guess trouble in the next 5yrs with calls for democracy from the better off towns.

Thrugelmir

howee wrote: »

Look at the Chinese the whole world needs them to spend yet the lower the interest rate the more they save!

Too simplistic. The Chinese economy is far from mature. In rural areas 20 farmers still share a single donkey.

Despite our problems the UK is comparatively rich. So can address its own problems. Not be bailed out.

PaulF81

howee wrote: »

They also have an issue well known in the West

Old age and with the one child policy they may actually be in a worse position than the US or EU.

I guess that creates a job or two though lol

Not if they don't bother with pensions it won't.

Generali

Joeskeppi wrote: »

My economics A level taught me that if people are saving too much then interest rates are too high.

Did your teacher then discuss the liquidity trap? Where people save regardless of rates as they are saving for reasons other than to earn interest.

It's also worth noting that very high savings rates are consistent with the permanent income hypothesis. If the Government runs very high deficits, people realize their taxes will go up in future so will not spend the windfall they receive from Government overspending.

Generali

howee wrote: »

I am no fan of the BBC but I don't mind the guy and he has been to China on several occations.

His argument is also logical, How long before the Chinese want Japanese motorbikes, Ipads (made in china), a taste of the west? If the Yuan is kept low exports great imports not so good. The wages in comparison to GDP have also fallen. An average family save around one quarter to one third of their monthly income which is great until you realise its for property or children's education NOT for consumer goods. If the roads, airports house building does dry up (and it will), they need the mother of all spending binges or GDP will fall, unemployment will rise and we really will be in the brown stuff.

GL

iPads are popular in China because the best gift of all is one your kids made for you.