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No. This is NOT how it works. China exports its domestic demand to the US, the US absorbs Chinese overcapacity. This initially began as China importing ineffici
by rrggrr 10y ago
No. This is NOT how it works. China exports its domestic demand to the US, the US absorbs Chinese overcapacity. This initially began as China importing inefficient US industrial production in the 70s-90s, in exchange for US expectation of access to an enormous Chinese market. That trade never really occurred as the short terms incentives weren't present, resulting in Chinese inefficiencies and massive imbalances for both sides.
Read this:
http://carnegieendowment.org/chinafinancialmarkets/66485 http://carnegieendowment.org/chinafinancialmarkets/66485
- coldtea 10y ago>the US absorbs Chinese overcapacity How charitable of them. Well, whatever makes one sleep at night with their national superiority intact. As a third party that's neither Chinese nor American, that's what I see.
- rrggrr 10y agoThis is exactly the policy the US seeks to now reverse (absorbing over-capacity) and which planned reversal China meets with threats of war. It wasn't charity as you well understand. The US exported its inefficient industries initially for the unfulfilled expectation of access to much greater markets for its efficient industries.