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China is absolutely guaranteed to be the global hegemon going forward. The last week sealed it.

arrosenberg 1y ago
China has major liquidity and economic issues, as well as a demographics bomb, and their biggest market for the manufacturing that drives their economy just said "no thank you". They are not situated to replace the US. When the US is done gun-footing itself, we will still be in a better position going forward than China, although I agree we are probably going to have to accept a loss of hegemony.
- defrost 1y ago
  China is the largest manufacturing hub on the planet and exports globally. At 14% or so the US is certainly their largest direct customer. China has essentially stated it believes it can belt tighten and go forward with the rest of the world as customers longer than the US can go forward without direct imports from China, should the US eventually get its manufacturing back on track, so be it.
  - arrosenberg 1y ago
    What does belt tightening look like? How many more highways to nowhere can they build to pump their GDP? Can they accept a 10% drop in exports? I doubt many could, especially the country most reliant on exports.
    - fspeech 1y ago
      You underestimate the importance of imports as a lubricant to the service economy. Sure you don't need the next new gadget, but many service jobs depend on your wanting it.
      - deleted 1y ago
        [deleted]
      - arrosenberg 1y ago
        Maybe! I don't think a few jobs in advertising are going to make or break things. It is also going to be easier for us to spin up factories to make microwaves than it will be for China to spin up a consumer economy to buy them. They also may blow it by trying to invade Taiwan, the US doesn't have an outstanding X-Factor like that, we already elected him.
        fspeech 1y ago
        Isn't creating demands the US strength over China? Now you are saying it is not important for the US but important for China? Either way NYT recently did a good piece on the "China Shock" and the main takeaway is that people couldn't react to changes that happened too fast but they finally did. Now suddenly they are pushed to go the other way overnight.
        arrosenberg 1y ago
        What part isn't clear? China needs our market more than we need their factories. It's going to be bad for both countries, but my thesis is that it will be worse for them, and the US will come out of it still well positioned economically. I'm not sure what the New York Times has to do with anything, they're constantly spouting opinions that don't pan out.
        fspeech 1y ago
        Your conclusion isn't logical. US per capita income is far higher meaning its economy is far more leveraged. To put it simply Costco employees need to push through way more goods per person, Google employees way more ads per person to sustain their much higher income. On the other hand, Chinese unskilled migrant export factory workers, while low wage, have a rural home to go back to and their standard of living won't change that much, while their skilled technicians can not be replaced en mass anywhere in the world. There's no way you can win a contest of pain against China. Think of the comparison as throwing sand into gears that are running at different speeds. You do far more damage to the one running at high speed. The reason I brought up the NYT article is to say that even if you think change is important doing it rapidly is going to put the people that the policy is supposed to help through the wringer.

China has major liquidity and economic issues, as well as a demographics bomb, and their biggest market for the manufacturing that drives their economy just said "no thank you". They are not situated to replace the US. When the US is done gun-footing itself, we will still be in a better position going forward than China, although I agree we are probably going to have to accept a loss of hegemony.

defrost 1y ago
China is the largest manufacturing hub on the planet and exports globally. At 14% or so the US is certainly their largest direct customer. China has essentially stated it believes it can belt tighten and go forward with the rest of the world as customers longer than the US can go forward without direct imports from China, should the US eventually get its manufacturing back on track, so be it.
- arrosenberg 1y ago
  What does belt tightening look like? How many more highways to nowhere can they build to pump their GDP? Can they accept a 10% drop in exports? I doubt many could, especially the country most reliant on exports.
  - fspeech 1y ago
    You underestimate the importance of imports as a lubricant to the service economy. Sure you don't need the next new gadget, but many service jobs depend on your wanting it.
    - deleted 1y ago
      [deleted]
    - arrosenberg 1y ago
      Maybe! I don't think a few jobs in advertising are going to make or break things. It is also going to be easier for us to spin up factories to make microwaves than it will be for China to spin up a consumer economy to buy them. They also may blow it by trying to invade Taiwan, the US doesn't have an outstanding X-Factor like that, we already elected him.
      - fspeech 1y ago
        Isn't creating demands the US strength over China? Now you are saying it is not important for the US but important for China? Either way NYT recently did a good piece on the "China Shock" and the main takeaway is that people couldn't react to changes that happened too fast but they finally did. Now suddenly they are pushed to go the other way overnight.
        arrosenberg 1y ago
        What part isn't clear? China needs our market more than we need their factories. It's going to be bad for both countries, but my thesis is that it will be worse for them, and the US will come out of it still well positioned economically. I'm not sure what the New York Times has to do with anything, they're constantly spouting opinions that don't pan out.
        fspeech 1y ago
        Your conclusion isn't logical. US per capita income is far higher meaning its economy is far more leveraged. To put it simply Costco employees need to push through way more goods per person, Google employees way more ads per person to sustain their much higher income. On the other hand, Chinese unskilled migrant export factory workers, while low wage, have a rural home to go back to and their standard of living won't change that much, while their skilled technicians can not be replaced en mass anywhere in the world. There's no way you can win a contest of pain against China. Think of the comparison as throwing sand into gears that are running at different speeds. You do far more damage to the one running at high speed. The reason I brought up the NYT article is to say that even if you think change is important doing it rapidly is going to put the people that the policy is supposed to help through the wringer.