Posted on 10/13/2002 11:01:08 AM PDT by MeneMeneTekelUpharsin
Behind It: Foreign Ventures Shifting Focus, and Locals Boosted by WTO Status Price Pressure on U.S. Griddles
What's more, Chinese knockoffs of the foreign companies' goods made competition tougher. So, many foreign-based manufacturers, with plants in place and funds committed, looked for markets abroad. Philips and a swarm of other foreign manufacturers soon learned that using China as an export base proved to be more profitable, and easier, than selling locally. Philips now operates 23 factories in China and exports nearly two-thirds of the roughly $5 billion in goods those plants produce each year.
Today, there are few things in the gobal marketplace that aren't made in China. The export drive of foreign companies' stand-alone plants, their joint ventures and China's thousands of homegrown operations has put China at the center of a broad reordering of how goods are supplied to the global economy. Companies have been forced to scrap old business strategies and come up with new ways to compete.
Many foreign manufacturers find they must either produce in China or expand their purchases from China. The country has become the world's factory floor, with output so massive and wide-ranging that it also exerts deflationary pressure world-wide on everything from textiles to TVs, mobile phones to mushrooms.
Rest on page A1 of Thursday, Oct. 10, 2002 WSJ
THAT is exactly why there is such a push into "globalization". These big organizations will be eaten by smaller ones if they don't.
Competition is great, except if you are competing with me. So they make system where the big companies get favored, and thats that.
"globalization" can do good, but the breed of it they now employ should be cast off forever.
Your assumption in many cases is flat out incorrect. In many cases the product price is NOT driven down by importing from China. Its simply not.
If I can make a pair of shoes for $10 in Mexico, and I can make them for $8 in China, but I can sell either pair for $75, why chose Mexico?
I get an extra $2 bucks for chosing China, but the end price is hardly affected. The consumer doesn't benefit, or hardly care at all, but the executive pay of those on top of the totem pole will go through the roof.
Deflationary costs in pricing are not rooted in China. They are rooted in competition for marketshare, overall supply, and overall economic conditions.
LOL! Okey-dokey. The "I just know it" standard of proof is not one that is terribly credible to other people, but if you like your little fantasy, go right on ahead!
And you castigate me for engaging in straw-man arguments.
Many of the products you see are falsely priced.
There are some economic values to using China, but you certainly did not make any arguments for any of them.
The only thing going up in relation to Chinese imports is the wages of the left over company execs, that is after they have laid everyone else off.
You got it dude.
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The money ends up in the hands of the brokers.
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It takes a two or three step reasoning process to understand that. Don't attempt to expain it to idiots or people in denial.
What they pay is a whole different matter.
The spread between their purchase price, and ours is where they make money. These guys don't want to trim their own fat and run a real business.
Fact is, these big corporations will sink if the game is changed. Medium size businesses ($100 million in revenue+) will run the show if I am in charge.
The other east asian nations had to switich to higher and higher sophistication of their products because their small population's GDPs quickly rose with the induction of any industry.
And hence their market was born. We had production and capital contained among only 'X' number of workers, and consequently, they made more money. They also consequently purchased more goods and paid more for them.
Consequently the real</> market, ie the people you sell to experienced an outward expansion in numbers and quality of consumers.
How well did we do this quarter?
The real concern at this point is that China may in fact develop into some kind of a closed system where the wages are low, but all the prices of consumer goods are equivalently low. What I mean is that they may internalize their domestic market(Produce everything they consume at rock bottom prices) If thats the case then that country has the potential to bleed the entire world dry of industrial infrasture and still maintain rigorous growth due to its own domestic consumption. It means that even if we are too poor to buy their super cheap goods, the day may come, when their own people are rich enough to afford all the stuff they can make, when that day comes, they will no longer need us as consumers. I expect WWIII by then.
China may in fact develop into some kind of a closed system where the wages are low, but all the prices of consumer goods are equivalently low. What I mean is that they may internalize their domestic market(Produce everything they consume at rock bottom prices) If thats the case then that country has the potential to bleed the entire world dry of industrial infrasture
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