Stock markets doom !

[DmonSlyr]

Wages in China have risen substantially. I know, because I have over 100 people there. CE graduates salaries in Beijing are as high as Silicon Valley. Factory wages have soared also in the past few years.

You have to know the territory from ground level to know reality. Western reporting is staggeringly wrong or tainted on purpose about China.

How are they still able to produce so cheaply then? And why are so many countries sticking it to them with tariffs and Anti-dumping laws? It seems to me like countries are attacking china because china is stealing a large portion of the manufacturing industry away from their economies because it is so much cheaper. Do you think countries are fed up with this and have finally realized that china is stealing GDP from countries by providing the cheapest possible products? Is India going to be the same way?

Or do you think China is taking the hit it needs to take by increasing these wages overall?

[Rolex]

China is no different than North Carolina was 30 years ago - "stealing" factory jobs from the traditional factory centers in the north. They cause the rust belt.

Politicians will always find foreign boogeyman to blame and stick tariffs on.

Markets go up and down. Currencies go up and down. The problems in the US economy and the stock market now are no more the fault of China than saying the US economy and actions by the FED caused the drop in the Chinese market.

Manufacturing has always, and will always, move to cheaper options. People have to train and be educated for different (higher level) jobs that have higer accompanying wages.

Manufacturing is already moving from some areas of China to cheaper areas of China. The rush to lower cost is inevitable. The Chinese are not always driving prices down. The quality and price is determined by the Buyer, not the Seller or Manufacturer.

There is an old joke about two buyers going to visit a Chinese T-shirt factory. The Japanese buyer has 3 assistants and they spend a week studying in excruciating detail every facet of material sourcing, and the manufacturing process - focused solely on quality and packaging.

The US buyer shows up, takes a glance at the shirt and says, 'Yeah, that's fine. Now, let's negotiate this price to get it lower. How can we makes things even cheaper."

That is the part about supply and demand that is unknown to most people. The Chinese factories build to the spec and quality the buyers demand. Go blame Walmart for the crappy quality stuff filling your house.

[DmonSlyr]

I guess my understanding is, at what point is too cheap to where supply grows to its max production and prices would then have to be increased to offset the demand to where even the cheapest goods would have to be increased, but at the same time demand would diminish depending on the good, so instead of growing supply with a higher price/demand you would have to sell cheap and run out of supplies based on what the buyer wishes, which would hurt the business? If scarcity were to happen because of cheap products and higher capacity for supply, wouldn't that hurt the economy? At some point prices have to be raised to maintain the scarcity level, But if these prices increase artificially due to scarcity demand, while the consumer demand decreases in countries because the working class doesn't reap any business growth, wouldn't that also hurt the overall economy?

Sort of like what is happening to oil right now.

They have to keep prices high because of scarcity, even though the demand has shrunk so they cannot make higher profits, this intern causes layoffs because they have no other way to cut expenses in order to keep having better profits.

So instead of healthy growth in the market. We are striving for the cheapest possible products/materials which only increases the impact of scarcity and therefore prices artificially increase while not benefiting anyone. Instead of getting paid more because of a higher demand for the businesses products with higher prices and productivity, we are taking the cheap route and passing off to the workers who intern either get laid off or paid minimally, thereby causing demand to go down in the market while being forced to increase prices.

Am I making sense?

[FLS]

Why are you biased towards central control which has never worked vs the free market which always has? Seriously, where did that notion come from?

Again, look at Venezuela now after years of wage and price controls. The only control any government has over the economy is the ability to screw it up.

[zack1234]

China is not stealing anything, US investment conglomerates are investing in China.

US investments are invested in China.

They dont give a rats bellybutton about american.

Blah blah blah

Americans have fought in wars to end communist tyranny and see what they have got for it

China reaping the rewards

[Brooke]

DemonSlayer, you should read this:

Economics in One Lesson, by Hazlitt

(or if you are OK with book that is longer but a little more thorough along the same lines:
Basic Economics, by Sowell)

Those books will answer all your questions and more.

The reason young people like you are screwed by today's economic environment is because people support policies that go in exactly the opposite direction of what works, as explained in either of those books.

[morfiend]

China is not stealing anything, US investment conglomerates are investing in China.

US investments are invested in China.

They dont give a rats bellybutton about american.

Blah blah blah

Americans have fought in wars to end communist tyranny and see what they have got for it

China reaping the rewards

 Zack,plz tell me what you really think?


     You use statements that are so obvious,it makes me think you arent tell me the "rest of the story"!


   

[DmonSlyr]

Why are you biased towards central control which has never worked vs the free market which always has? Seriously, where did that notion come from?

Again, look at Venezuela now after years of wage and price controls. The only control any government has over the economy is the ability to screw it up.

 I'm not saying Gment needs to mandate price controls and stiff tax codes, that is not the solution I am encouraging. Although I do think regulations do need to be placed in to keep the work environment and products safe for the workers and consumers, also to encourage better business ethics.
What my solution is encouraging is for companies to create a better socitey for people in America by paying them better. I don't think this so called "market wage" is good for our economy and is very much limiting the consumer spending in this country. That's going to be even worse when 35% of the nation has student loan debt crippling them even further from consumer spending. The education and skills I've learned in college don't even come close to how much I spent for that compared to the "market salery" for college graduates, and I'm lucky. Just wait till that starts to build up even further. People my age are giving 25% of income in taxes and SS while giving another 350 a month on loans. That's close to a grand we are shelling out to the Gment every month on top of living expenses. It's simply not feasible with these "market wages" at 30K for a 25 YO trying to get out the parents house. So much for college.


I'll really have to get to reading those books Brooke. I'm eager to learn about what they have to say. I like the free market and I've always been a capitalist, but if we don't start making our country better again by providing real wages, our markets will be extremely overvalued with artificial growth and it will collapse while regular people will have nothing to fall back on.

[ink]

I hate to inform you of this...but I can not read anymore without saying something.....

in absolute seriousness....


everything that has been said here is absolutely pointless....

left/right/democrat/republican/Black/white/sports/anti/pro....

all are just smoke and mirrors...to confuse and divide...


The ENTIRE systems needs an overhaul.


don't fret it is coming.

[DmonSlyr]

I hate to inform you of this...but I can not read anymore without saying something.....

in absolute seriousness....


everything that has been said here is absolutely pointless....

left/right/democrat/republican/Black/white/sports/anti/pro....

all are just smoke and mirrors...to confuse and divide...


The ENTIRE systems needs an overhaul.


don't fret it is coming.

Thats true man, just gotta be a go getter in this world.

I just talk about what I see and read around me and I really enjoy economics.

I am not talking about small businesses who are already suffering for a profit, that part I get. A company that pulls in 260k a day for one store shouldn't be paying people lousy salaries for working 10 hours of their day. It's a business ethics issue for me and the way we are shaping the work force.

[icepac]

I've noticed my brand of socks are getting smaller every year.

[ghi]

We are officially in recession here in Canada,  since yesterday morning  all the news are talking about it; low oil prices messed up economic growth and cad exchange rate, (0.75usd).    

Btw, dont mess with the China, here they come 

"Five Chinese Navy Ships Are Operating in Bering Sea Off Alaska Coast"

http://www.wsj.com/articles/pentagon-watches-as-chinese-navy-ships-sail-in-bering-sea-1441216258

Rolling B26s : 

[DmonSlyr]

I am glad to hear the opinions of real business owners and officers such as yourselfs. I know there has always been the employee/owner battle and I don't agree with unions either. I'm just looking for ways to create growth in America from the inside so that our stock market will be sustainable as the future generations move up. And I'll be honest, its not very encouraging for us right now.

[Rolex]

The world stock markets are nothing like they were 30 years ago. They are no longer sources of working capital to fund quality companies. They are manipulated to the point that they are no longer truly markets.

The more free markets become, the more true markets they are, and usually the more free the society is that they are designed to serve. The markets don't serve society anymore. They serve the bankers and market manipulators.

The writings of Von Mises are another source of excellent, timeless insight. Read on...

[zack1234]

So the US wins WWII Europe is broken and they introduce the Marshall Plan.

It was all explained in that book written in 1860 which evokes an immediate forum violation.

There has not been a free market economy since 1945, its been based on the above.

The only way to keep this charade going is having wars and blaming someone else.

1. Iraq
2. Iran
3. Putin
4. That fat bloke from North Korea
5. Gaddafi
6. The Red Coats and tea bags
7. The Contras
8. The Brewster
9. China

Why do you think the EU is allowing the Ukraine into the EU? Because they are hard working and democratic

When the 2nd cold war comes the conglomerates will need more factories in China for the money they are going make.