Will China Overtake the US as the Number One Economic Superpower?

[miller]

Americans are the most stupid, irrational, brainwashed clowns God has ever put on this earth.

 

[konkon]

China has a population five times the size of the US. They need a larger economy than ours.

The US has been building its infrastructure over the last 100 years. China has a lot of catching up to do. The shortcuts they are taking with environmental and labor regulations will also eventually catch up with them

This is so true. A lot of their own money will be used-up for fundamental purposes and this will take a huge chunk out of their budget over the decades.

I also think the US is in a win-win position with respect to currency-plays. China is buying US debt and in the past has, not officially of course, threatened to offload US dollars into the market if the US, for example, puts tariffs on Chinese imports. But this would benefit the US more as it pretty much wants a cheaper US dollar; this is something China does not want. Because it still kind of pegs its currency to the USD, it will be forced-down with the US dollar and it will create a spiraling inflation situation in China. In other words, China will have to unpeg its currency for a while which will make it more expensive to buy its exports around the world. This will kill the goose that laid the golden egg.

The US is in a better position than the Chinese going forward as it can use this scenario and others to 'bargain' with the Chinese. Or the US can go all in in this high-stakes game of world domination and really put the screws on China; make inflation a real problem there.

 

[skeptic]

China has a population five times the size of the US. They need a larger economy than ours.

The US has been building its infrastructure over the last 100 years. China has a lot of catching up to do. The shortcuts they are taking with environmental and labor regulations will also eventually catch up with them

This is so true. A lot of their own money will be used-up for fundamental purposes and this will take a huge chunk out of their budget over the decades.

China is in a far better position than we are as far as infrastructure goes. The US has ancient, out of date infrastructure that we can't even afford to replace and modernize at Chinese labor costs.

China on the other hand is building brand new state of the art infrastructure like the world's longest bridge, largest dam and fastest bullet trains. And their costs to install it are 10% of what we would need to spend to do the same, but they don't have the political gridlock, NIMBY and regulatory barriers that plague us.

China is also the world's capital of foreign investment, today.

In terms of infrastructure, and military strength I would far rather be in China's position with their economy than in ours no matter how much head start we already have in both departments.

China has a huge population, and they will need a LOT of resources to develop. And they may face social or political crisis. Any one of these could stymie their development. But the nation with the most modern infrastructure and the most modernized education wins the infrastructure issue. And in 5-15 years we may be 20 years behind them with no money to ever catch up.

 

[konkon]

This is in reply to skeptic (above); sorry quote didn't list like I wanted it to.

Sure, China will have to outspend the US and will develop state of the art infrastructure and might one day look like a futuristic metropolis that we see in films. They will even have more money that the US. I don't doubt this at all.

But they will have to fight and fight hard to get ahead of the US with being able to control the world's economy. Not being an English speaking country will put them behind the eight ball too.

When you said China being the leader in capital investments, did you mean buying-up currencies around the world? Well this will contribute to China's woes too because this will strengthen their economic portfolio and put pressure on their currency to increase in value, which will make exports more expensive. The bottom line is, they can't have it this good for too long. Something has to give and their exports will inevitably become more expensive. Wages etc will rise too. The standard of living in China might end up being so high that their potential export market might contract or even be higher than what it is today but not enough to claim the top prize. Let's not get carried away, their export market is what it is today because of cheap labor.

The US will always be miles ahead with their military technology. I'm only going to speculate here, so don't send those micro mosquito-like drones after me, please! LOL. But no country on Earth will surpass the US with their high-tech military technology. I think you need to go beyond being able to mass produce products and copy things to be able to enter the same class as the US here. No country on Earth has come close. Once again I, like most people on Earth, can only speculate as to what might be out there and have no knowledge of specifics; and don't want to know either.

The US will always have money to catch up if it falls behind, because nearly everything is priced in US dollars (even inflation; notice how inflation hasn't spread to the US like it has to the rest of the world). What happens if China stops pegging its yuan to the USD? Up she goes!

As for infrastructure gridlock. Remember when China had that 80 or so mile traffic jam a year ago? So it can't all be smooth sailing for such a populous nation.

Trying to deal with a capitalist system that at the best of times is unpredictable and can be controlled from abroad, will be the toughest thing China has to deal with in the future. That's if it ever decides to become one. It would have to try to claim the top spot. But will it? This is where China will get stuck.

and P.S. I do love the Chinese and have the highest respect for them.

 

[skeptic]

When you said China being the leader in capital investments, did you mean buying-up currencies around the world?

No. I meant that foreign investors who poured brazzillions of dollars into the US to build factories and businesses for decades are now abandoning the US and pouring far more capital into China.

I started a thread a few days ago with an article from the WSJ that said foreign investment in emerging Asian economies is expected to return 20%/year for at least 5 years.

Whereas foreign investment into the US might break even or net 3%/year.

Foreign investment is the strongest force effecting economic development, and it typically has collateral benefits we observe as a good economy.

 

[skeptic]

The US will always be miles ahead with their military technology.

Yeah, sure. Wrong.

China is on a path to eclipse our technological advantage within a few years. Like maybe 4.

Technology advances as a product of research and manufacturing. The manufacturing sector is vital to developing new technology. We no longer have a manufacturing sector and we rely on China to make the components that support our military hardware. Whatever new technological advances emerge in the next decade will be owned by China and India primarily and our outdated technology will become obsolete.

China copies our weapons systems today, in ten years we will be copying theirs.

 

[BolshevikHunter]

China's problem is the massive gap between it's Middle class and poor who are mostly peasants. The millions and millions and millions of poor foks there cannot compete with what even our poorest are making. It will, and has taken many, many decades of economic growth for China to even compete with American growth, which we obviously had a very big head start on them. However, our debt with them will effect the speed of their growth and help advance their system even quicker. They are without a doubt 2nd in the World as a Superpower, and for how long this all lasts anyone can say if and when they will surpass the USA on the World stage. Either way, They are building their Military up very quickly, even though the percentage is still nothing close to what we spend annually even though we are clearly financially screwed. My guess is the international bankers that rule our Nation will start a War with China in order to justify their default on our outstanding debt to them. ~BH

 

[Sallow]

China has a population five times the size of the US. They need a larger economy than ours.

The US has been building its infrastructure over the last 100 years. China has a lot of catching up to do. The shortcuts they are taking with environmental and labor regulations will also eventually catch up with them

China's not going anywhere unless they "Liberalize" and do something about the corruption. And that's not going to happen anytime soon. There are several big cities are well run..and up and coming..but the current configuration of their government and society is only going to get them so far.

Think big third world power.

 

[konkon]

When you said China being the leader in capital investments, did you mean buying-up currencies around the world?

No. I meant that foreign investors who poured brazzillions of dollars into the US to build factories and businesses for decades are now abandoning the US and pouring far more capital into China.

I started a thread a few days ago with an article from the WSJ that said foreign investment in emerging Asian economies is expected to return 20%/year for at least 5 years.

Whereas foreign investment into the US might break even or net 3%/year.

Foreign investment is the strongest force effecting economic development, and it typically has collateral benefits we observe as a good economy.

Yes, China will surpass the US as a wealthier nation (although a lot of this type of investment benefits other countries, like the US, as revenue and profits go back to the US international companies). But the capital markets are 'controlled' by the west, and predominantly, the US. This is the key, and the US will not give this control up. This goes beyond what's happening domestically in the United States. There are definitely two sides to the US capital markets. The one (and only one, for now) that is still going strong is the international one, where the US dominates the dynamics of the international markets. This goes way beyond the net worth of China and its potential to vastly increase its net worth.

An analogy of what I'm saying would be like the dynamics of a casino versus its patrons. The house or casino has an intrinsic (or fixed) advantage over the sums of money and ability of its patrons (except for counting (banned) or betting on red or black, I guess, where you could just keep doubling your bets!). The US is basically the house in this high-stakes game and it does have certain advantages that other countries don't, no matter how much money you have or use. Even if China's wealth doubles that of the US one day, China will not be able to have this advantage over the US or the rest of the world unless it gains the so called house advantage. How it might try to do this and whether the US allows this to occur, is another matter, and one (I'm sure) China will never be able to gain. The US would have to give this up and why would they do this? It would be like a casino giving up its intrinsic mathematical and statistical advantage to its patrons or its wealthiest patrons, and I can't imagine why this would occur.

A comment was made, on another post, about India and China, but China will not be a strong ally with India. The two will undermine each other as they are potentially fierce rivals, in an economically competitive sense. I think you may find China having stronger ties with Pakistan than India.

It is possible that the east will go through a kind of 'cold war' era, not as severe and intense as the US/Soviet one, but enough to stifle growth in those countries. Hard to believe now, but it could play-out that way. This would pave the way for the US to gain in strength even more. Any advantage the US has or will have, being the 'house' and controlling the world's markets, it will take.

 

[skeptic]

But the capital markets are 'controlled' by the west, and predominantly, the US. This is the key, and the US will not give this control up.

They/we already are, and willingly. I have no idea whether we will surrender all of our power, but we are surrendering it a whole lot faster than I ever thought possible.

 

[Brutus]

We no longer have a manufacturing sector and we rely on China to make the components that support our military hardware.

Brutus: that of course is BS. We still make 20% of the worlds manufactured goodsand that is 45% more than China makes. Moreover, our manufacturing is on balance all high tech.

 

[zzzz]

China has a population five times the size of the US. They need a larger economy than ours.

The US has been building its infrastructure over the last 100 years. China has a lot of catching up to do. The shortcuts they are taking with environmental and labor regulations will also eventually catch up with them

WRONG! Our infrastructure is falling apart. We have not been building or maintaining our roads, sewers, electrical grid, water supply systems and many of our aging factories are not being upgraded but still using outdated production equipment. China on the other hand is creating everything from scratch and they will be in great shape in 20 years. We will not. We do not have the money to reinvest in our future so our decline is guaranteed. The only question is how fast will it be.

 

[skeptic]

We no longer have a manufacturing sector and we rely on China to make the components that support our military hardware.

Brutus: that of course is BS. We still make 20% of the worlds manufactured goodsand that is 45% more than China makes. Moreover, our manufacturing is on balance all high tech.

Only if you measure that output in dollars.

What you are saying is like saying that the US has 20% of the world's real estate simply because the price of US real estate is 20% of the appraisal value of the world's real estate.

But in reality, the US only has 5% of the world's actual real estate.

Likewise China makes at least 50% more manufactured goods than the US does based on equivalent measures of goods. The US markets identical or equivalent goods for a much higher price because we can, since we don't need a trade surplus like the rest of the world does.

But you don't know what a trade surplus is, do you Mr Jones?

 

[skeptic]

China has a population five times the size of the US. They need a larger economy than ours.

The US has been building its infrastructure over the last 100 years. China has a lot of catching up to do. The shortcuts they are taking with environmental and labor regulations will also eventually catch up with them

WRONG! Our infrastructure is falling apart. We have not been building or maintaining our roads, sewers, electrical grid, water supply systems and many of our aging factories are not being upgraded but still using outdated production equipment. China on the other hand is creating everything from scratch and they will be in great shape in 20 years. We will not. We do not have the money to reinvest in our future so our decline is guaranteed. The only question is how fast will it be.

EXCELLENT point!

If you include our industrial infrastructure, i.e. factories and the means of production then the US is probably losing our infrastructure as fast as China is adding to hers.

 

[KissMy]

China Has Already Surpassed the USA !!!.
This has already happened. Just because our financial markets measure of US dollars flowing from them does not show it, that doesn't mean jack.

China Leads the World in:
Merchandise Manufacturing
Merchandise Exports
Automobile Manufacturing
Automobile Consumption
Housing Production
Housing Consumption
Industrial Production
Industrial Consumption
Raw Materials Consumption
Natural Gas Consumption
Oil Consumption
Coal Consumption
CO2 Emissions
Energy Consumption
Renewable Energy Production
Renewable Energy Consumption
Cement Production
Cement Consumption
Steel Consumption
Copper Consumption
Zinc Consumption
Nickel Consumption
Aluminum Consumption
Platinum Consumption
Gold Production
Rare Earth Materials Production
Rare Earth Materials Consumption
Rare Earth Materials Exports
Forest Products Consumption
Lumber Consumption
Paper Consumption
Cotton Consumption
Phosphates Consumption
Potash Consumption
Poultry Production
Poultry Consumption
Meat Consumption
Grains Consumption
Corn Consumption
Soy Beans Consumption
Wheat Consumption
Food Consumption
Food Production
Railway Construction
Road Construction
Infrastructure Construction
And the List Goes On!

FT: China takes lead in financial deals

Deals and capital raisings in China’s booming financial services sector have outpaced those in the US for the first time since records began in 1995, fuelled by a wave of refinancings by Chinese banks needing to repair their balance sheets.

There have been $36.2bn-worth of deals in China’s financial sector so far this year, compared with $26.2bn in the same sector in the US, according to data from Dealogic.

Bankers said the increase in deal flow was being driven by large refinancings by Chinese banks as they move to shore up their capital this year, rather than full takeovers.

“The Chinese government has been rigorous and disciplined about maintaining strong capital ratios in the banking system and as a result one may see more and more capital allocation and reallocation among financial services companies,” said John Studzinski, head of Blackstone’s global advisory business.

In response to the financial crisis, Beijing ordered a credit-fuelled investment boom in late 2008 to boost flagging growth and in 2009 Chinese banks handed out roughly double the volume of new loans extended the previous year.

 

[rdean]

No.

Those jobs were going away regardless. I don't have enough information to determine whether the U.S. Chamber was correct in their seminars, but I know that the intent was to keep management and control of the operations based here in the USA.

So that's the answer? Those jobs were leaving anyway?

So far, yes. Mind you, I've only given this some serious consideration just because you have repeated it over and over and over again so I figured it might be another opportunity to find out how flawed you are. Meh, I'm bored.



Times change and I'm not racist.

Now, Republicans have discovered that if you paint the inside walls a bright white and put in a cafeteria, you can work people 50 to 60 hours a week and pay them 51 cents an hour and no one cares. Especially, with collusion of the communist government in charge.

Well then they are pretty fucking incompetent since there are way more than 2.4 million manufacturing jobs in the US.

Sure, a lot of people commit suicide. So they put up "nets" around the buildings to "solve" the problem.

Now, some of those very same Republicans see China as a "business model". Go figure.

Protectionism isn't a solution, no matter how much you and the 6% of your friends think it is.

You asked for reasons, I gave you some. You said you were "bored". Perhaps it's that you are "boring"?

 

[konkon]

China has a population five times the size of the US. They need a larger economy than ours.

The US has been building its infrastructure over the last 100 years. China has a lot of catching up to do. The shortcuts they are taking with environmental and labor regulations will also eventually catch up with them

WRONG! Our infrastructure is falling apart. We have not been building or maintaining our roads, sewers, electrical grid, water supply systems and many of our aging factories are not being upgraded but still using outdated production equipment. China on the other hand is creating everything from scratch and they will be in great shape in 20 years. We will not. We do not have the money to reinvest in our future so our decline is guaranteed. The only question is how fast will it be.

The US does have the money, and not necessarily in the physical sense of cash in the hand. The world no longer operates like this at these macro levels. What US citizens are experiencing is the other side, which is devastating at the moment, of the economy. There is an international economy that the US still controls and will continue to control. The US will not allow countries like China to gain control of these 'markets'; I use this term loosely because they don't fall under the normal definition of 'market'. This is what I believe is happening:

The Federal Reserve and 'its' class of banks are forcing the US dollar to drop. The net result of this internationally is commodity prices and inflation is increasing overseas (and US exporters are benefiting from the low USD). This is causing a lot of, mainly developing, nations to revolt. The anger is directed purely to their own governments. This will create change, and the type of change that the US's international arm wants is one that allows US investments on a grand and perhaps unprecedented scale to hit those international markets. You see, when they topple the current leaders and their defunct economic programs, the US (Fed and banks through indirect loans, and companies) will have buying power of an unprecedented scale.

If you think I'm joking just look at how much money a country like Australia gets from the US (in terms of loans that will be paid back), to finance all aspects of its economy; it's around 40 to 50 percent. There is nothing wrong with this as this benefits Australia's fiscal policy and Australia pretty much can't just do it all on their own. It's good for the US and Australia. This is normal everyday economic practices that every country has to promote and practice. This goes on and has, even though the public is not told of this. Once again, there is nothing wrong with this practice.

Those in control of this are, as strange as this sounds now, looking after long-term US interests. If the US doesn't act to control the direction markets around the world will take, then a country like China will! International markets are warfare of a different kind. Any country that thinks 'na, I better play fair' or doesn't use its might and position to regain or gain control, will get crushed in the long run. There a voids to fill and the US is making sure it fills as many as it can before a country like China does.

The low US dollar inversely lifts the Euro and puts upward pressure on the Yuan. This can't work for either as it will decrease exports. The Chinese yuan should be increasing around 5% to 10% a year with China's strong economic growth. By forcing the US dollar down, the Fed in the US is putting additional and unsustainable pressure on China's currency and its long term growth potential. The Fed in the US is making sure that China has a rocky-road ahead of it. But it can't and won't admit to this. It is looking after long-term US interests, although technically it can not admit it is deliberately reinforcing problems in China and other potential US customers.

I honestly believe if it was up to the Fed and those in charge of the US's international interests (and there are only a few of them), they would devalue the US dollar another 30% over the long term. This will kill China's aspirations for world domination of exports and manufacturing. The yuan would have to increase in value or inflation would be at unmanageable and dangerous levels. Their manufacturing sectors and exports would suffer dearly.

 

[Flopper]

China has a population five times the size of the US. They need a larger economy than ours.

The US has been building its infrastructure over the last 100 years. China has a lot of catching up to do. The shortcuts they are taking with environmental and labor regulations will also eventually catch up with them

WRONG! Our infrastructure is falling apart. We have not been building or maintaining our roads, sewers, electrical grid, water supply systems and many of our aging factories are not being upgraded but still using outdated production equipment. China on the other hand is creating everything from scratch and they will be in great shape in 20 years. We will not. We do not have the money to reinvest in our future so our decline is guaranteed. The only question is how fast will it be.

The US does have the money, and not necessarily in the physical sense of cash in the hand. The world no longer operates like this at these macro levels. What US citizens are experiencing is the other side, which is devastating at the moment, of the economy. There is an international economy that the US still controls and will continue to control. The US will not allow countries like China to gain control of these 'markets'; I use this term loosely because they don't fall under the normal definition of 'market'. This is what I believe is happening:

The Federal Reserve and 'its' class of banks are forcing the US dollar to drop. The net result of this internationally is commodity prices and inflation is increasing overseas (and US exporters are benefiting from the low USD). This is causing a lot of, mainly developing, nations to revolt. The anger is directed purely to their own governments. This will create change, and the type of change that the US's international arm wants is one that allows US investments on a grand and perhaps unprecedented scale to hit those international markets. You see, when they topple the current leaders and their defunct economic programs, the US (Fed and banks through indirect loans, and companies) will have buying power of an unprecedented scale.

If you think I'm joking just look at how much money a country like Australia gets from the US (in terms of loans that will be paid back), to finance all aspects of its economy; it's around 40 to 50 percent. There is nothing wrong with this as this benefits Australia's fiscal policy and Australia pretty much can't just do it all on their own. It's good for the US and Australia. This is normal everyday economic practices that every country has to promote and practice. This goes on and has, even though the public is not told of this. Once again, there is nothing wrong with this practice.

Those in control of this are, as strange as this sounds now, looking after long-term US interests. If the US doesn't act to control the direction markets around the world will take, then a country like China will! International markets are warfare of a different kind. Any country that thinks 'na, I better play fair' or doesn't use its might and position to regain or gain control, will get crushed in the long run. There a voids to fill and the US is making sure it fills as many as it can before a country like China does.

The low US dollar inversely lifts the Euro and puts upward pressure on the Yuan. This can't work for either as it will decrease exports. The Chinese yuan should be increasing around 5% to 10% a year with China's strong economic growth. By forcing the US dollar down, the Fed in the US is putting additional and unsustainable pressure on China's currency and its long term growth potential. The Fed in the US is making sure that China has a rocky-road ahead of it. But it can't and won't admit to this. It is looking after long-term US interests, although technically it can not admit it is deliberately reinforcing problems in China and other potential US customers.

I honestly believe if it was up to the Fed and those in charge of the US's international interests (and there are only a few of them), they would devalue the US dollar another 30% over the long term. This will kill China's aspirations for world domination of exports and manufacturing. The yuan would have to increase in value or inflation would be at unmanageable and dangerous levels. Their manufacturing sectors and exports would suffer dearly.

The Fed has been working pretty hard at devaluing the dollar. The question in my mind is how long will China support the dollar. A major devaluation of the dollar would be devastating to Chinese exports, however continuing to support the dollar seems pretty risky.

 

[konkon]

The Fed has been working pretty hard at devaluing the dollar. The question in my mind is how long will China support the dollar. A major devaluation of the dollar would be devastating to Chinese exports, however continuing to support the dollar seems pretty risky.

And this is why the US is in a win-win (long-term, of course) position. China has to support the dollar or it is in deep trouble. The Chinese are dependent on supporting the US dollar and it's becoming a really bad dependency habit. Some might think the US should keep printing money as this will cause more headaches for China down the track.

A confronting problem like this could derail or slow down China's economy.

 

[skeptic]

China Has Already Surpassed the USA !!!.
This has already happened. Just because our financial markets measure of US dollars flowing from them does not show it doesn't mean jack.

Give this man a cigar, give brutus 20 minutes with a humping pit bull.