World Economic Equilibrium: Worth looking at again?

Discussion in 'Economy' started by Vanquish, Dec 6, 2010.

  1. Vanquish
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    Vanquish Vanquisher of shills

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    I know this is going to come off all "workers of the world unite" aka communist/socialist...but really that's not what I'm going for here. Believe me when I say that.

    That being said...I really don't think America's financial problems will EVER become manageable again until there's some semblance of economic equilibrium across the entire planet.

    No...I'm not saying that everyone should get a hand out. No...I'm not saying that profit is evil and economic opportunities shouldn't be exploited. (Everyone knows a lot of money is made from finding something cheap somewhere and selling it high elsewhere. I get that and believe in it)

    But there are always going to be countries and companies in those countries who have less restrictive laws, less consumer and worker protections, and are willing to exploit them.

    I'm not saying we have to fix the world or have one world government...but that ignoring the global economic equilibrium shift is killing us.

    Thoughts?
     
  2. uscitizen
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    uscitizen Senior Member

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    Our standards of living for most of our people will continue to decline until our main competitors in the worlds lving standards come up closer to where we are.

    It is inevitable with Global/"free" trade.
     
  3. Vanquish
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    Vanquish Vanquisher of shills

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    Exactly. But we seem to be sticking our heads in the sand about it.
     
  4. Toro
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    Toro Diamond Member

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    The way you get "economic equilibrium" on the planet is to make everyone as rich as we are. And the way not to make everyone as rich as we are is to impose our standards and laws on everyone else.

    There is a growth curve to economic development, whereby poor countries become richer by making cheap things cheaper. Raising those costs, as you imply, will do nothing but keep the poor desperately poor.
     
  5. loosecannon
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    loosecannon Senior Member

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    It is tempting to think those thoughts. I hear you.

    But IMO that is naive thinking.

    I do not believe that China or the next superpower is gonna honor the same globalization rules that are currently balancing the world's power. I think they will retain a grip on authoritarian government and yuan hegemony and protectionist tactics as long as they possibly can. Which may be until after the population bomb has peaked and receded and resource scarcity has changed everything about our economy.

    Nation states always have first and foremost protected their own interests and even if the west might want to share power amongst a coalition in order to secure it there is no guarantee that the next superpower will violate the age old rules for the sake of Kumbaya.

    As powerful as tiny Japan managed to become in just 2 decades China has 13 times their population and a better relationship to resources than the island of Japan. They are 1/5th of the world. Even at wage parity China is destined to be the geopolitical leader of the world.

    And China has already established a network of ties to the developing world to give them a good shot leading the larger more resource rich coalition in the future. And they are quickly matching and surpassing our technological plateau.

    Plus the dollar/yuan relation is triggered to flip and catapult China toward great wealth while the dollar tumbles. That's what happened to the Yen in 85.

    China will be as savage a world superpower as they were savage toward their own during their last revolution.
     
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  6. loosecannon
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    loosecannon Senior Member

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    well that is impossible because there simply are not enough resources for even half the present population to share our living standards.

    So exactly how do you plan to redefine our wealth?

    It's a race toward the bottom Toro, not toward the top. Every previous model since the industrial revolution began had the advantage of exploiting massive virgin resources. That won't happen again.
     
  7. william the wie
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    william the wie Gold Member

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    I was with you LC until you got to Japan 85 and didn't continue the analogy. China has played all of its cards to hype growth and Bernancke's trashing of the dollar will crush it.
     
  8. Vanquish
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    Vanquish Vanquisher of shills

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    Equilibrium will happen whether we want it to or not. The question is how do we get there. Living conditions in China have risen as a direct result of the effect...similarly in India. Mexico seems to be remaining stagnant or even regressing, and predictably, crime is on the rise there.

    How do we win, economically, while still increasing our standard of living?
     
  9. loosecannon
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    loosecannon Senior Member

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    Unlike puny Japan who actually was reliant on a trade surplus with the US China is planning to switch polarity and shift toward the developing world as their market, including of course themselves. They won't really need the US as a leading trade partner, and we will be reliant on them for basics like cell phone components and military components.

    Japan fell into terminal deflation after 85 because they priced themselves out of the world labor market and there was no developing world to replace the US as their trade partners. Today all of the wealth is migrating toward the developing world. They are the future consumer society of the world, not the developed nations.
     
  10. JULIO
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    JULIO BANNED

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    I predict with an assured confidence that the only way out is for us to discover some object which is admitted even by the deadheads to be a legitimate excuse for largely increasing the expenditure of someone on something!
     

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