"Too_Many_Tools" wrote in message
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On Apr 3, 5:13 am, "Ed Huntress" wrote:
"Too_Many_Tools" wrote in message

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On Apr 2, 9:53 pm, "Ed Huntress" wrote:





posting stripped to RCM only

"Too_Many_Tools" wrote in message

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On Mar 27, 9:27 am, reinhardt wrote:

On Mar 24, 5:15 pm, Too_Many_Tools wrote:

The jury is out on this one....

What do you think?

TMT

Recession is a given. Can we avoid depression?

Why avoid one when that was desired goal to begin with?

Do you know how financially reasonable depression labor is?
Actually your comment does make sense.

No it doesn't.

If one wants to level the world labor market in respect to costs, one
must lower the United States labor costs to Third World levels.

No one wants to level the world market. They want the low-wage countries
to
make the goods, and the high-wage countries to buy them. That's how one
makes the most profit.

--
Ed Huntress
There are other countries that will buy goods...have you noticed how
companies are falling over each other to sell to China?

There are a lot of people in China, a tiny percentage of which can buy
expensive goods. But even a tiny percentage of 1.2 billion people is a lot
of customers. This is what businesses have been anticipating for a long
time. Meanwhile, the West is China's export market, and its entire economy
still hinges on exports.

The United States is quickly running out of money...and credit.

Really? I think you're engaging in wishful thinking and some confused
conclusions from the current financial troubles here, TMT. You're sounding
like the flip side of the right-wing nutbags. The US will continue to be a
large market for low-wage countries.

No money or credit...no buying of goods.
The United States is becoming the cheapest place to produce.

Having covered this topic for some decades as a magazine reporter, I can
tell you that the US was the cheapest place to produce advanced machine
tools, for example, as far back as the early '90s. It's also been the
cheapest place to produce top-tier cars (ones that meet Western quality
standards) for about the same length of time. (Korea probably holds that
title now.) That's because we have the most productive manufacturing
economy
in the world. As of five years ago (I haven't checked current figures), we
were roughly ten times as productive as China, for example.

Before you drink the Kool-Aid with the Chicken Little brigade, you should
spend more time with the numbers, and less time with the doomsday stories
written by fairly ignorant reporters in the general press.

--
Ed Huntress- Hide quoted text -

- Show quoted text -

I disagree Ed.

If we are so productive, then why are the jobs leaving the country?

Because we may be the most productive, but we aren't the cheapest. They are
two different things. Productivity is a measure of the dollar (or other
currency) value of output per labor hour. Cheapness is a measure of how much
one has to pay to get something made. If you're Reebock and you can get
running shoes assembled in the interior of China for $0.17/hour, you don't
care if they only get 1/10th the productivity of US workers, or even 1/20th.

If we are so productive, then why has so much of our manufacturing
infrastructure been moved offshore?

See above.

I would suggest looking at the national debt, the rate of lending that
the Feds doing and the loss of housing equity and then get back to me
as to how much money/credit this country still has.


You can't draw a conclusion about how much money or credit we have from that
information, TMT. As for our national debt, as a percentage of our GDP it is
less than that of Japan, Canada, Norway, Sweden, Switzerland, France,
Germany, and about 60 other countries. You'll have to define what
constitutes "lending," in your view, by the Fed before we can address that
question. Regarding housing equity, the bubble of exuberance is getting a
haircut and probably will decline to something closer to housing's true
replacement value.

--
Ed Huntress