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> future number one market That's highly unlikely given the current state, as US consumer is is about 1/3 of the world's household consumption https://www.sele

> future number one market That's highly unlikely given the current state, as US consumer is is about 1/3 of the world's household consumption https://www.selectusa.gov/largest-market https://www.selectusa.gov/largest-market, and is growing 3% this quarter. China has alot of debt problems, and will suffer heavily in a trade war. About 45% of Chinese GDP is in 'investment', where probably half is waste (continued state investments into expensive-to-maintain, rarely used rails, bridge, and buildings). Whereas for a developed country like US, it's about 20% investment (70% in consumption). Population wise, US is augmented by steady immigration and will increase to 400 million in 2040, 500 million in 2100. China hit its peak in birthing in 1970s, and has been experiencing a steady decline since, projected to hit max 1.4 billion people in 2030 and then go to around 1 billion or below in 2100. US average income is still 7 times the Chinese average income. IMO, China's hit its peak already in 2008 and is in decline, whereas US has recovered from 2008 and is rising

philwelch 8y ago
> China has alot of debt problems, and will suffer heavily in a trade war. About 45% of Chinese GDP is in 'investment', where probably half is waste (continued state investments into expensive-to-maintain, rarely used rails, bridge, and buildings). Whereas for a developed country like US, it's about 20% investment (70% in consumption). This seems like almost the reverse of the conclusion you're trying to support. Investments in development and infrastructure are a good mechanism for long-term economic growth, and it's not clear that a trade war will hurt China worse than it hurts the US.
- joefranklinsrs 8y ago
  > Investments in development and infrastructure are a good mechanism for long-term economic growth That's true up to a point where the infrastructure is facilitating economic movements and transactions. China has already gone past that point to where they are building infrastructure for the sake of building infrastructure, not considering whether those rails and buildings will produce enough income to support maintenance in the next 5-10 years. There is such a thing as diminishing rate of returns (otherwise every economy would just keep building infrastructures forever) Currently, for every yuan Chinese government directly spends, it now only gets 1 yuan of return back, and it is declining. As for the trade war, I think it is pretty evident who is winning, I won't go too much details into it; you can google every data around the aftermath of the tariffs.
- adventured 8y ago
  > Investments in development and infrastructure are a good mechanism for long-term economic growth That of course depends on the infrastructure situation in question. Japan vaporized trillions of dollars on infrastructure and it did absolutely nothing of consequence to boost their growth. Infrastructure wasn't their problem as it turned out, so each follow-on dollar they plowed into additional unnecessary infrastructure spending produced declining rates of return. China is guilty of plenty of that so far. The US is the least trade dependent major economy. It would benefit from shifting some imports to increased domestic production, such as in the steel and aluminum industries. It's better to pay slightly higher prices if necessary and to produce domestic investment with quality blue collar jobs. That's not a universal of course, there's little benefit to the US trying to manufacture $20 toasters or $3 playing decks of cards or $1 shoe laces by hand. It's ideal for the US to consume less and produce more. European nations boost savings rates with very high VAT taxes. Tariffs are another means to accomplish the exact same end, except it's even better because it bolsters domestic production at the same time that it reduces consumption by raising the cost of consumption. So not only is there an extreme lobsided imbalance between the benefit in US / China trade due to the trade deficit there, the US would benefit from fewer goods pouring in from China in all scenarios because of the gains in domestic manufacturing (even if they're modest) + domestic investment, and lowered consumption. Less capital flows overseas, more stays home. There's always the scenario that comes up of: what if China cuts off something that isn't easily replaced such as smart phone manufacturing, or similar. Other countries can easily pick up the slack, such as Vietnam which is a booming electronics manufacturer (and makes a lot of smart phones now). On the flip side, China can't operate at all without US tech. They'd have to turn to stealing it. The rest of the world would largely proceed to banish those then-illegal Chinese products accordingly (particularly Europe, Latin America, Japan, AU/NZ, Mexico, Canada, etc).
- robdachshund 8y ago
  We only "need" China because we are accepting 3rd world level labor, and we have allowed our own industries to die in favor of outsourcing. If China is forced to adhere to 1st world labor standards, they lose all power over the US. There are few things produced in China that cannot be produced here. The state of things is caused by a feedback loop. China needs the west to purchase its goods. Break that dependence, and China will have no choice but to play ball and end its parasitic relationship with the West. American manufacturing used to be booming. Look at the 50s and 60s. Quality of life and buying power for factory workers was massive, and people bought American goods. We have basically allowed ourselves to be dependent on China by accepting their horrendous labor standards and allowing our industries to die. There is no reason we cannot reverse course and reinvest in our nation. If the us institutes tariffs and boycotts Chinese goods, they are fucked and will have to adapt. China has undeserved economic power and is causing an imbalance within the global economy.

philwelch 8y ago

> China has alot of debt problems, and will suffer heavily in a trade war. About 45% of Chinese GDP is in 'investment', where probably half is waste (continued state investments into expensive-to-maintain, rarely used rails, bridge, and buildings). Whereas for a developed country like US, it's about 20% investment (70% in consumption). This seems like almost the reverse of the conclusion you're trying to support. Investments in development and infrastructure are a good mechanism for long-term economic growth, and it's not clear that a trade war will hurt China worse than it hurts the US.

joefranklinsrs 8y ago
> Investments in development and infrastructure are a good mechanism for long-term economic growth That's true up to a point where the infrastructure is facilitating economic movements and transactions. China has already gone past that point to where they are building infrastructure for the sake of building infrastructure, not considering whether those rails and buildings will produce enough income to support maintenance in the next 5-10 years. There is such a thing as diminishing rate of returns (otherwise every economy would just keep building infrastructures forever) Currently, for every yuan Chinese government directly spends, it now only gets 1 yuan of return back, and it is declining. As for the trade war, I think it is pretty evident who is winning, I won't go too much details into it; you can google every data around the aftermath of the tariffs.
adventured 8y ago
> Investments in development and infrastructure are a good mechanism for long-term economic growth That of course depends on the infrastructure situation in question. Japan vaporized trillions of dollars on infrastructure and it did absolutely nothing of consequence to boost their growth. Infrastructure wasn't their problem as it turned out, so each follow-on dollar they plowed into additional unnecessary infrastructure spending produced declining rates of return. China is guilty of plenty of that so far. The US is the least trade dependent major economy. It would benefit from shifting some imports to increased domestic production, such as in the steel and aluminum industries. It's better to pay slightly higher prices if necessary and to produce domestic investment with quality blue collar jobs. That's not a universal of course, there's little benefit to the US trying to manufacture $20 toasters or $3 playing decks of cards or $1 shoe laces by hand. It's ideal for the US to consume less and produce more. European nations boost savings rates with very high VAT taxes. Tariffs are another means to accomplish the exact same end, except it's even better because it bolsters domestic production at the same time that it reduces consumption by raising the cost of consumption. So not only is there an extreme lobsided imbalance between the benefit in US / China trade due to the trade deficit there, the US would benefit from fewer goods pouring in from China in all scenarios because of the gains in domestic manufacturing (even if they're modest) + domestic investment, and lowered consumption. Less capital flows overseas, more stays home. There's always the scenario that comes up of: what if China cuts off something that isn't easily replaced such as smart phone manufacturing, or similar. Other countries can easily pick up the slack, such as Vietnam which is a booming electronics manufacturer (and makes a lot of smart phones now). On the flip side, China can't operate at all without US tech. They'd have to turn to stealing it. The rest of the world would largely proceed to banish those then-illegal Chinese products accordingly (particularly Europe, Latin America, Japan, AU/NZ, Mexico, Canada, etc).
robdachshund 8y ago
We only "need" China because we are accepting 3rd world level labor, and we have allowed our own industries to die in favor of outsourcing. If China is forced to adhere to 1st world labor standards, they lose all power over the US. There are few things produced in China that cannot be produced here. The state of things is caused by a feedback loop. China needs the west to purchase its goods. Break that dependence, and China will have no choice but to play ball and end its parasitic relationship with the West. American manufacturing used to be booming. Look at the 50s and 60s. Quality of life and buying power for factory workers was massive, and people bought American goods. We have basically allowed ourselves to be dependent on China by accepting their horrendous labor standards and allowing our industries to die. There is no reason we cannot reverse course and reinvest in our nation. If the us institutes tariffs and boycotts Chinese goods, they are fucked and will have to adapt. China has undeserved economic power and is causing an imbalance within the global economy.