On Tue, 30 Dec 2014 10:46:06 -0500, Ed Huntress
wrote:
On Tue, 30 Dec 2014 19:38:53 +0700, John B. Slocomb
wrote:
On Tue, 30 Dec 2014 00:56:51 -0500, Ed Huntress
wrote:
On Tue, 30 Dec 2014 10:31:50 +0700, John B. Slocomb
wrote:
On Mon, 29 Dec 2014 12:20:38 -0500, Ed Huntress
wrote:
On Mon, 29 Dec 2014 07:11:44 -0800, Larry Jaques
wrote:
On Mon, 29 Dec 2014 02:04:18 -0800, mike wrote:
On 12/28/2014 5:29 PM, John B. Slocomb wrote:
On Sun, 28 Dec 2014 15:08:49 -0800, mike wrote:
On 12/28/2014 1:18 PM, Larry Jaques wrote:
On Sat, 27 Dec 2014 22:26:29 -0800, mike wrote:
On 12/27/2014 9:44 PM, Ed Huntress wrote:
On Sat, 27 Dec 2014 02:08:54 -0800, "Howard Beal"
wrote:
"Ed Huntress" wrote in message
...
Much snipped
Much more snipped
"Deming is best known for his work in Japan after WWII, particularly
his work with the leaders of Japanese industry. That work began in
August 1950 at the Hakone Convention Center in Tokyo when Deming
delivered a seminal speech on what he called Statistical Product
Quality Administration. Many in Japan credit Deming as the inspiration
for what has become known as the Japanese post-war economic miracle of
1950 to 1960, when Japan rose from the ashes of war to become the
second most powerful economy in the world in less than a decade,
founded on the ideas Deming taught:"
True. The Japanese have a long history, right back the "Black ships"
and before, of acquiring foreign technology.
Japan became interntaionally recognized for quality in just over a
decade. China is still known for junk, after three decades or so.
But a lot of junk. Far more then Japan ever produced. Harbor Freight
is a 2 billion dollar business and Walmart probably more, to say
nothing of all the other countries.
Japan's GDP grew from 102,607 (Millions of dollars) in 1945 to 375,090
in 1960, a growth of 360%. China's GDP grew from 225.3 Billion Rmb in
1970 to 1985 (15 year period) to 896.4. a growth of 398%.
That's a lot of junk. g
A large volume, low cost, product is not unique to China, after all
the largest employer (except for the U.S. government) does exactly
that.
You're comparing retail with manufacturing.
I'm not sure that is a logical statement. After all why does one
"manufacture" if not to sell it? Whether it is wholesale or retail is
really immaterial. Certainly cost of materials is a significant item
in most project calculations.
Chrysler's problem was that they weren't selling cars but were still
making them :-)
Granted there are differences between Japan and China but at least in
certain industries, perhaps in many, there is a very definite intent
on improving.
We'll see how successful they are. Fourteen years ago, executives at
VW's China factory said they'd be ready to export to Western countries
within five years.
'Still waiting.
In reality, who cares?
The Chinese care. They're getting antsy about not being able to sell
cars to advanced Western countries.
Of course they care. It is another sales product. One doesn't want to
overlook any opportunity.
I don't have up-to-date figures but in 2005 Chinese White Goods
exports to the EU alone was worth 4,185 billion dollars. In 2005 China
produced 31 million refrigerators, 30 million washing machines and 75
million air-conditioning units, for export. Again, I don't have
comparative figures but in 2012 VW's world wide earnings were 254
billion.
Whether VW-China is a success or not may not be a significant detail.
A friend does fiberglass work on yachts and a Wholesaler in Bangkok
recently sent him some fiberglass cloth samples in an effort to
convince him to buy from them. It was really rough stuff with the
weave very uneven and a lot of knots where a strand had been spliced.
He sent the stuff back and included a sample of the Australian (I
believe) cloth that he uses. The Wholesaler called home to discuss the
matter and in the conversation the Wholesaler said that he had sent
the cloth back to the Chinese factory and they were very interested in
my friend's comments and would strive to do better and would send
improved samples at a later date.
Here there are many single cylinder, water cooled, diesel engines used
- they even "home build" built a small truck with them called a "Etan"
which originally was powered with Japanese made "Kubota" engine, see:
https://www.flickr.com/photos/percyv...7629962147807/
For an action shot see:
https://www.youtube.com/watch?v=0AmeF4jV8gw
Today, they are nearly all powered with either a Chinese copy of the
Kubota, or a Chinese made Kubota as Kubota has established factories
in China in order to remain competitive.
I suspect that question is how much longer can the U.S. maintain its
current levels of income as more and more jobs move overseas. The
current unemployment rate in the U.S. is, I believe, 5.8% and it is
being bragged about. Thailand, on the other hand is 0.7.
We could go on forever with anecdotes, John, and I could point you to
some analyses by specialty labor and trade consultants, but you could
find them if you want. Let me just say that the number of US jobs
"lost" to offshoring is wildly exaggerated for a number of reasons.
But the most importnat figures are these:
Total private (non-government) US employment, before the effects of
the recession were felt, Nov. 2008: 113,636,000. As of Nov. 2014:
118,868,000.
And the Economist's current estimate is that China's economy will
exceed the U.S.'s by 2021 but their graph shows the Chinese economy to
continue to grow at an accelerated rate while the U.S. lags behind. A
previous estimate made by the Economist (2011) showed China exceeding
the U.S. in 2018 so their updated forecast (2014) seems to be well
within the limits of most estimates.
Econometric forecasts for China are running into the same syndrome as
similar projections that were made for Japan, in the 1980s. Some
weaknesses appeared in Japan's economy that weren't in the econometric
models. Then the economists scrambled to figure out what had happened.
All projections were scrapped. Now the big question is whether Japan
will escape the "liquidity trap" and be able to stimulate their
economy again -- ever.
If you follow the economic projections carefully, you'll see the
possible beginnings of a parallel situation. China's current slowdown
was NOT predicted. Now the economists are falling all over themselves
to figure out what's going on.
Stay tuned. They're approacing the Lewis Turning Point while they
still have huge numbers of peasants in the countryside, wanting in on
the action.
I'm not sure that is of importance at the moment. The Lewis Turning
Point simply explains that at some point in a country/society's
development the numbers of available labor will determine the cost of
labor.
At the moment the legal minimum labor cost in Shanghai is 17 Rbm an
hour, or US$ 2.75. The U.S. federally mandated minimum seems to be
7.25 an hour (it does vary from state to state) and I read here that
many are arguing that it should be $12.00 an hour.
So... If wages in China double they will, in U.S. terms be $5.50 an
hour and it is doubtful that wages will be doubled in China in one
fell swoop. They rose by an average of 12.6% from 2008 - 2012.
During the same period it is likely that short of a financial disaster
the U.S. wage will increase - I see that the President advocates a 34%
increase.
So, we have an instance of a country that has a very low cost of
living and an equally low wage competing with a country that has a
very high cost of living and wage.
Given the globalization of manufacturing and trade logic would
indicate that jobs will immigrate to the lower cost countries and
unless the U.S. takes some extremely drastic action it is almost a
foregone conclusion that either jobs will decrease or possibly higher
paid jobs in industry will decrease while lower paid jobs in the
service sector will increase - Macdonald's always needs floor
sweepers.
From
http://www.statista.com/statistics/1...us-since-1990/
employed rates dropped from 62.8% in 1990 to 58.6% in 2013.
In China during the same period employment increased.
Even counting losses due to fast-climbing productivity improvements,
and counting the recovery from the recession, our net job gains are
not bad. Offshoring has hit some specific job categories and
industries pretty hard, but the US has one hell of a resilient
economy. Overall, the effect of offshoring is estimated to reduce our
employment growth by around 10% to 12%. It's a very hard thing to
measure accurately.
Difficult to analyze but jobs alone may not be the important factor.
If Macdonald's hires more counter persons certainly the unemployment
number goes down but I'm not sure that is a significant fact when
looking at the overall economy.
Bottom-line answers to this come from tracking GDP per capita and then
doing a quintile analysis from IRS data. People have done it. The
result is that middle incomes are dead flat and have been for almost
three decades. Uppermost incomes are roaring ahead.
That's a big problem, but it's not because they're all working at
McDonald's. You can use the analysis tools at the Federal Reserve, the
Bureau of Labor Statistics, and the Bureau of Economic Analysis
websites to get answers to these questions.
Yup. From 1988 China's exports grew from just over 100 billion to a
2013 value of 4.16 Trillion and as of 2013 were 40% greater then the
U.S.
As for those "trucks" you linked to, they tell a story in themselves
-- and it's not a story that US truck manufacturers are going to worry
about. d8-)
Well, the link wasn't supposed to impress you with the vehicles, it
was to demonstrate the varied use of Chinese made engines in 3rd world
countries :-)
I"m glad they found a market. There are a lot of water buffaloes that
are going to be out of work. d8-)
But not wasted. A younger brother of my wife's butchers something like
50 a day and he tells me that supplies are diminishing rapidly .
These days a good buffalo is hard to find :-)
--
Cheers,
John B.