China June trade surplus swells five-fold

Reuters ^ | Reuters

[jpsb]

BEIJING (Reuters) - China's trade surplus for June swelled five-fold from a year earlier as exports grew much faster than imports, offering more ammunition for foreign critics who argue that Beijing should let the yuan rise in value.

The June surplus grew to $9.68 billion, exceeding forecasts of $8.0 billion and towering above the $1.8 billion surplus recorded for June 2004.

[Alberta's Child]

in 1970 the median household income was 25,000... today its 40,000.. in 1970 a semester at Harvard was about 2,500 today its 40,000.

Like you said, it depends on what you wish to look at. You just happened to select the one area of our economy (education) where costs have escalated even as quality has declined dramatically since 1970. I went to Staples the other day to buy some office supplies, and a new keyboard for my home computer cost less ($10) than a new mouse pad ($12).

In 1970 a HS graduate could expect to earn the median income levels, own 2 cars a boat 3 kids and a boat to fish in and spending money... today a HS graduate can't in general expect that.

In 1970 a HS graduate was probably better-educated than a college graduate in 2005, so I don't see that as a problem.

Free Trade didn't invent the computer or the IC or the MRI.... standard of living increases were created largely because larger manufacturing companies had excess money to pump into R&D.. something that Service industry jobs, because they don't create nearly as much wealth as manufacturing cannot afford to do.

Wrong. Standards of living improved because cheap imports allowed people to spend money on things that otherwise would have been unaffordable to them. Someone who pays $10 today for a pocket calculator that cost $100 back in 1970 has an "extra" $90 that his 1970 counterpart didn't have. Multiply that by any number of fianancial transactions over the course of a year, and you can see why even people on welfare can afford to go to Disney World today.

[expat_panama]

it takes a true pessimist to conclude that the American economy is in trouble.

I don't know how these people do it.   Like, if I managed to put in all the effort it would take to make myself believe we had a bad economy, I'd be so exhausted that I'd be to weak to even turn on my computer.

[Alberta's Child]

And they will eventually start to figure out the corporate world and develop their own companies.

That's great, because at that point they won't even be Chinese anymore -- they'll be Americans.

[Alberta's Child]

The main reason that it's easier to sell stuff to rich people than to poor people is that the rich have more money.

That's only part of the equation. Rich people also have less time (which is one reason why they have more money), so they are more willing to trade money for time. That's why rich people hire landscapers, and why landscapers never work in their own neighborhoods.

[junta]

The open borders kook/traitors have a better idea allow unlimited immigration from China to the USA, and then we will be competitive with China when the numbers of Chinese here equal the number of Chinese in China.

[Andrewksu]

It is great, unless communism or their threatening military, in one form or another prevails.

The there are many factors to our social/economic/political success and freedom. Democracy, capitalism, and our culture has made for an impressive and fair country. With China, the mix of a hostile government and political system teamed with a economic powerhouse makes one worry. The USSR failed because communism strangled them economically and helped keep their military at bay. China has been aggressively building their military, which may or may not be problematic, but I would prefer our military to overshadow them significantly.

[expat_panama]

Bear in mind that income distribution only tells part of the story.   That lowest quintile (119 of 204) in '70 is right now doing a lot better than the lowest quintile today.   In 1970 I supported my family by cleaning toilets at Denny's.   Now I'm CEO of a multinational.   Things change-- for the better.

[Alberta's Child]

With China, the mix of a hostile government and political system teamed with a economic powerhouse makes one worry.

I think that's where you are incorrect. China is not really an "economic powerhouse" at all, primarily because it lacks some of the key ingredients that you mentioned (democracy, capitalism, etc. -- including a legal/political climate that allows business to flourish).

[Alberta's Child]

In 1970 my income was zero.

I wasn't even two years old, so at least I had an excuse for that. LOL.

[Paul Ross]

"Considering the vast amount of wealth that Americans create every year and the unemployment rate we have (a rate that the average European leader would literally kill for), it takes a true pessimist to conclude that the American economy is in trouble."--Modernman

Reality Check from History: Oh, yeah?" I would add the caveat that I actually greatly admire Herbert Hoover, and he wasn't responsible for either the speculative bubble preceding the Crash, or fully to blame for the failed economic recovery efforts he launched. But, in retrospect, it appears he was self-constrained by overly-tight monetarist policies. He kept on contracting the money supply. On the fiscal side, he was actually slowly backing into the fiscal interventions that FDR later openly embraced as his own. But as we know, what really worked was WW-II, restoring manufacturing, getting rid of the dead hand of excess capacity, forcing immense investments and kick-starting the engine of the American wage-earner back into play as a force for economic growth.

So, as brilliant as Hoover was, and as well-educated and advised, what he thought he knew was wrong. Or at least insufficient to the task at hand.

He provided for us an example NOT followed by GWB and Alan Greenspan this time around after 9-11. Thank God! But we still have to note when Hoover was just plainly expounding wishful thinking, instead of actual solid fact. His failure to turn it around led directly to FDR getting in and turning our Constitution upside down. Let's hope today's wishful thinking crowd don't produce even greater calamaties...

Oh Yeah?: Herbert Hoover Predicts Prosperity

http://historymatters.gmu.edu/d/5063.html

Oh Yeah?: Herbert Hoover Predicts Prosperity

On the morning of October 24, 1929 ("Black Thursday"), billions of dollars in stock value were wiped out before lunch. Prices recovered somewhat that afternoon, but the Great Crash was underway. The next day President Herbert Hoover counseled reassurance, but as stock prices continued to plummet Hoover's reassurances rang increasingly hollow. The president's efforts to reassure the public did not stop, in part as he tried to convince voters that his policies were bringing recovery. In 1932, Edward Angly published a short book filled with optimistic forecasts about the economy offered by Hoover and his associates. The sarcastic title, Oh Yeah?, reflected his contempt for political leaders who did not seem to know what was happening to the country. These 17 quotations from or about Herbert Hoover proved that he was a poor prophet of the hard times ahead.

---

August 11, 1928

"Unemployment in the sense of distress is widely disappearing. . . . We in America today are nearer to the final triumph over poverty than ever before in the history of any land. The poor-house is vanishing from among us. We have not yet reached the goal, but given a change to go forward with the policies of the last eight years, and we shall soon with he help of God be in sight of the day when poverty will be banished from this nation. There is no guarantee against poverty equal to a job for every man. That is the primary purpose of the economic policies we advocate:

--Herbert Hoover, speech accepting the Republican nomination, Palo Alto, California.

September 17, 1928

"When we [the Republican Party] assumed direction of the Government in 1921 there were five to six million unemployed men upon our streets. Wages and salaries were falling and hours of labor increasing. . . . The Republican Administration at once undertook to find relief to this situation. At once a nationwide employment conference was called. . . . Within a year we restored these five million workers to employment. But we did more; we produced a fundamental program which made this restored employment secure on foundation of prosperity; as a result wages and standards of living have during the past six and a half years risen to steadily higher levels."

"This recovery and this stability are no accident. It has not been achieved by luck. Were it not for sound governmental policies and wise leadership, employment condition in American today would be similar to those existing in many other parts of the world."

---Herbert Hoover, Campaign Address, Newark, New Jersey

October 22, 1928

"Prosperity is no idle expression. It is a job for every worker; it is the safety and safeguard of very business and every home. A continuation of the policies of the Republican party is fundamentally necessary to the future advancement of this progress and to the further building up of this prosperity."

---Herbert Hoover, Campaign Address, Madison Square Garden

October 6, 1928

"As never before does the keeping of our economic machine in tune depend upon wise policies in the administrative side of the government."

---Herbert Hoover, Campaign Address, Elizabethtown, Tennessee

July 27, 1928

"The outlook of the world today is for the greatest era of commercial expansion in history. The rest of the world will become better customers."

--Herbert Hoover, Speech at San Francisco

November, 1929

"Any lack of confidence in the economic future or the basic strength of business in the United States is foolish."

--Herbert Hoover

January 21, 1930

"Definite signs that business and industry have turned the corner from the he temporary period of emergency that followed deflation of the speculative market were seen today by President Hoover. The President said the reports to the Cabinet showed that the tide of employment had changed in the right direction."

--News dispatch from Washington

March 8, 1930

"President Hoover predicted today that the worst effect of the crash upon unemployment will have been passed during the next sixty days."

--Washington dispatch

May 1, 1930

"While the crash only took place six months ago, I am convinced we have now passed the worst and with continued unity of effort we shall rapidly recover. There is one certainty of the future of a people of the resources, intelligence and character of the people of the United States, that is, prosperity."

--Herbert Hoover, Address at annual dinner of the Chamber of Commerce of the United States

October 2, 1930

"During the past year you have carried the credit system of the nation safely through a most difficult crisis. In this success you have demonstrated not alone the soundness of the credit system, but also the capacity of the bankers in emergency."

--Herbert Hoover, Address before the annual convention of The American Bankers Association, Cleveland

October 20, 1930

"President Hoover today designated Robert P. Lamont, Secretary of Commerce, as chairman of the President’s special committee on unemployment."

--Washington dispatch

October 21, 1930

"President Hoover has summoned Colonel Arthur Woods to help place 2,500,000 persons back to work this winter."

--;Washington dispatch

December 1930

"Economic depression cannot be cured by legislative action or executive pronouncement."

--Herbert Hoover, Message to Congress

June 15, 1931

"I am able to propose an American plan to you. . . . We plan more leisure for men and women and better opportunities for its enjoyment. We plan not only to provide for all the new generation, but we shall, by scientific research and invention, lift the standard of living and security of diffusion of wealth, a decrease in poverty and a great reduction in crime. And this Plan Will be Carried Out if We Just Keep on Giving the American People a Chance."

--Herbert Hoover, Address to Indiana Republican Editorial Association, Indianapolis

October 1931

"On September 8, I requested the governors of the Federal Reserve banks to endeavor to secure the co-operation of the bankers of their territory to make some advances on the security of the assets of closed banks or to take over some of these assets, in order that the receivers of those banks may pay some dividends to their depositors in advance of what would otherwise be the case pending liquidation. Such a measure will contribute to free many business activities and to relieve many families from hardship over the forthcoming winter, and in a measure reverse the process of deflation involved in the tying up of deposits."

--Herbert Hoover

October 18, 1931

"The depression has been deepened by events from abroad which are beyond the control either of our citizens or our government."

--Herbert Hoover, Radio address at Fortress Monroe, Virginia

Source: Edward Angly, Oh Yeah! Compiled from Newspapers and Public Records by Edward Angly (New York: Viking Press, 1931), 8–11, 14–17.

See Also:"The Gigantic Forces of Depression Are Today in Retreat": Hoover Insists That Things Are Getting Better

[Andrewksu]

Well, by maintaining a 7-10% increase in GDP since the early 80's, it certainly makes Russia look like it was operating a lemonade stand, and remember the arms race and worry Russia caused us. Now put China and it's current economic growth in Russia's shoes, and you have a worrisome situation.

I do agree with you though, that their current political system will eventually put the brakes on their growth and will enrage it's citizens who are now realizing the advantages of capitalism and the benefits of democracy. It will be really interesting at that point.

[Paul Ross]

I think the primary tensions won't be with its disappointed princelings and PLA officers running the industrial show, it will be the portion of the economy kept purely as old-fashioned communist state-enterprise flunkies. The very proof of who we are really dealing with in Bejing.

That hinterland populace wants the higher wages, they want to be on oceanfront properties, and a chance to get the big shot apartments. But they know they can't because they are not politically connected in the Party.

It is this basic social failure of the "communist consitutional compact" that needs to be exploited as a wedge issue by dissidents backed up by U.S. condemnations of their croney communism. Their abuse and disregard of their populace. Their oppressions. These need to be confronted...not ignored...and waved away.

[Last Dakotan]

Does anyone really believe that an accountant for General Motors generates 3.5 other jobs, while an accountant for KPMG only generates 1.6?

That he can statistically tells you the economic power of manufacturing employment, and why so many foreign countries are will to subsidize the growth of their manufacturing base.

[Modernman]

Actualy the second Iraq war was postponed because we did not have enough cruise missles because they were depleted in kosovo and never built back up in sufficent numbers.

That's a funding issue. We have a smaller navy for the same reason: We're not spending enough on the military.

[superiorslots]

Quote: I went to Staples the other day to buy some office supplies, and a new keyboard for my home computer cost less ($10) than a new mouse pad ($12).


Some things cost way less some way more. Not all things are dropping in price.

I sell group health insurance. 10 years ago the family rates averaged $350 per month. 10 years before that a good famnily rate was $80-100 per month. Now they are $1000 per month and some groups with older workers are paying $1200 or more PER family.

I have not seen wages keep up with cost. Besides health, I used to sell a ton of ancillary benfits like dental, small pernsion plans, disability etc. Those are going by the wayside because the employer no longer pays all the health premium. People are bing maxed out with theit health insurance cost. Getting harder and harder for a family to have to pay $600 per month for their sharre of the health cost when they are only making $10-12.00 per hour let alone save for retirement

Not all areas of the country are like Northern Virgina folks.

[Toddsterpatriot]

Nobody is buying American made products.

Do you realize how ridiculous you sound? Last year the US exported over $800 billion in goods. I guess it takes a whole lot of nobodies to buy $800 billion in goods that we don't produce anymore?

[listenhillary]

Freedom from government control and intrusion will out-produce even China's top down military controlled totalitarian/capitalism.

I recommend "The Discovery of Freedom:Man's Struggle Against Authority" Rose Wilder Lane

All is not well in China
http://www.freerepublic.com/focus/f-news/1436052/posts

[expat_panama]

Alberta's Child said in post 115 of 215  "...the U.S. economy has been strongest when we have been able to take advantage of huge disparities..."

expat_panama said in post 119 of 215 "...Americans get richer when a few successful people make a breakthrough and then everyone prospers.  'Income equality' gets really good when the economy tanks..." 

Paul Ross said in 154 of 215 "Deflating dollar numbers is a legitimate approach to viewing data with the effects of inflation removed."

Believe it or not, the graph was showing inflation adjusted incomes.  In other words, while those in the lowest 1970 quintile saw their real incomes increase by half (when they went to higher 2005 quintiles (see  207 of 215), the present batch of bottom quintile folk are able to enjoy 25% more real income than the previous occupants did.

I'm not saying life is good, I'm saying it's really good.

[Protagoras]

It is not explicated stated,

Or otherwise. But nice try son.

See ya at Wally World!!

[Alberta's Child]

Very interesting perspective.

This may sound bizarre to someone in your business, but it may very well be the case that medical insurance is an area where prices have experienced a steep DECLINE since 1970 -- if you compare these prices accordingly.

Health care costs have risen dramatically over the years for a number of reasons, including things like malpractice costs, government regulation, hospital billing practices, etc. But it's long been my opinion that the primary factor in these rising costs has been the rapid advances in medicine and medical technology over time. There are simply a lot more medical treatments available today than ever before, and insurance companies are expected to foot the bill for most of them.

Here's an interesting exercise for someone in your line of work. Sit down and put together a list of all the medical treatments, diagnostic tests, pharmaceutical products, etc. that have been developed since 1970. Then go to a major insurance carrier and get a quote from them for a major medical policy that doesn't cover anything that didn't exist in 1970. I'll bet your monthly premium of $600-$1200 would go down to about $50 per month.

Another angle of this issue is that the insurance costs are distorted simply because they are just that -- insurance costs. As a result, they aren't subject to the same price variations associated with supply, demand, economies of scale, etc. that would apply to a normal product or service. To get a sense of just how big a factor this is, consider this: most elective surgeries that are not covered by insurance (Lasik eye surgery and most cosmetic surgeries, for example) have gotten substantially less expensive over time.