Comments by "Andre Falksmen" (@andrefalksmen1264) on "Asianometry"
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@100c0c yeah, that would be a nice thought, unfortunately it's not looking that way.
I am an economist, I can come to the data, there's no country in the world besides China which is headed on course to have a significant impact. Since the 1990s there are only three countries which have been on track to enter the first world ranks.
The first, is obviously china, the other two are actually moving faster, but they are very small, that is Kazakhstan and azerbaijan. They're combined population is smaller than beijing.
When we look around the world, we see a West deep in Decline, with an aging population, unfunded social welfare obligations, stagnant socio political structures which require structural adjustment which is not politically feasible, and current account deficits.
Germany, the last of the western Nations to hold out as an industrial producer, has sacrificed itself to the American delusion of defeating Putin in ukraine.
When we look outside the west, the situation does not look promising. Obviously South Korea will continue to hold its own. Beyond that, there are no countries that are making the economic, structural, or political reforms, to set themselves up for development. India is a vain hope for those who foolishly think there is an alternative to china. Indonesia could be a force, but I don't see the Indonesians disciplined enough to climb the value chain with their natural resources. The Turks, long before erdogan, won't give up their love of Keynesian economics and constant inflationary policies.
To whom do you turn, there's no one!
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Japan is a primary example of the false narrative of "comparative advantage" used by the West to discourage developing countries from pursuing industrialization. While comparative advantage is real, the specific advantage may vary, is not innate and can be created. So, often Western Nations will tell third world Nations that they should focus on agriculture and forget about manufacturing because they have no capital, or past experience, or natural resource. Japan, just like taiwan, singapore, and South korea, broke into the critical area of heavy industry, steel manufacturing, even though all of the prerequisite materials had to be imported and remained cost-competitive by diligently building up their capital, knowledge-based, and efficiency. While, the West will often deny it today, at the start of the industrialization of the East Asian tigers, there were predictions of dismal failure. Today, We are told that Koreans are especially intelligent, but that was not their position in 1961 at the start of the heavy chemical and industrial drive. Park Chung he said if he had listened to the experts "he would have done nothing".
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@greenl7661 again, you clearly know nothing about economics. Not even the most basics, you're just repeating pop culture talking points. So as a real Economist let me educate you.
US Dollars position as a world Reserve currency is absolutely a legacy of the Bretton Woods system, at the time the US represented the largest portion of trade in the Free World and thus had a right to hold the reserve currency position. That is no longer the truth, commodity, oil for most amongst them, prices currently being priced in US dollars play a major role and US dollar Reserve status, but heavy-handed use of us sanctions is causing that situation to rapidly deteriorate. The largest trading nation in the world today is china, the US is simply a massive consumer of world goods, parasite made possible by printing money.
After the seizure of Russia's foreign reserves there is already massive sell-off of dollar Holdings by central banks all over the world, we need only look at the most recent reports and there is already plans underway to create an alternative to Swift that doesn't involve clearing funds in the us. As someone who actually works in such a field, and not an armchair observer, I can tell you that financial institutions around the world will be racing to that new system do not be subject to us sanctions, us laws, or other impediments to global trade created by the United states.
With regard to how foreign countries recycle their US dollar balances from America's parasitic consumption of other people's productivity while only supplying pieces of paper in exchange, in the past, they have purchased US equities, Treasury bonds, and even sometimes hard assets, but for the most part all they got were more pieces of paper and exchange for the real Goods Americans consumed. American Reserve Monopoly and paper Printing has allowed all Americans to live far beyond their means, productivity, and represents theft from the entire world. Every American is effectively guilty, not just the top 1%, but every American who earns us dollars.
As for the rest of your nonsense, about the choice of Reserve currency, American safety, Etc nonsense. The position of the world Reserve currency is not one which is held because other countries trust or like that country, it is merely a factor of production and consumption, of global trade. America's holding on to a legacy position, just like that of Great Britain and just like Great Britain prior to the end of the Sterling block, there may be some Nations who would like the United States to maintain the reserve currency position, but the economic reality is something quite different and your nonsense jingoistic americanisms will not save America from economic reality.
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@madensmith7014 if you're aware of the state of the United states, it is unlikely that we will be in a multipolar world for very long. The world is not going to be divided in half, the Chinese have displaced the United States as the primary manufacturing nation, the primary trading nation, the world's largest consumer of commodities, the largest supplier of finished consumer goods, the world's largest supplier of producer goods. The declining situation the west, combined with the precarious finances of the West means that any long-term capital investment and innovation in the world will be coming out of China. Even here, I have my fears, because China is plague with an aging population like the west. However, alas there are no countries with growth growing economies, toward the trajectory of full scale first world development, and a young/growing population.
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@wei270 this is all quite true, I studied economics, but I work in finance. Not as much of a change, but I saw many people from the stem Fields move into management and finance.
However, this change, which many Neo Marxist academics mistakenly call "late stage capitalism" actually a result of a stagnant system in need of structural adjustment, but structural adjustment cannot be achieved because it is not politically feasible.
First off you don't have real savings, so without any real savings you try to Garner growth through quantitative easing, but even when you print the money, there's no place you can invest the money without disrupting a displacing industries, which is not politically expedient, so it goes into existing assets, creating the asset bubbles we have seen since the 1960s, where the average person in the Western World can't even afford a home and the largest metropolitan areas of their country.
If you want to be in the flow of the money, you've got to go where it's flowing, which isn't too existing assets, the financial sector. If you're a civil engineering major, you could do all right, but in the Western World there are quite a bit of barriers to real growth that requires construction, better take your math skills get an mba, and work for a real estate private equity fund.
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@Curt_Sampson I see you also suffer from the same delusion. If Putin had wanted a quick and easy victory, he would have repeated what Americans do and boomed Ukraine to the ground and occupied the rubble. Instead, he has been willing to fight a war of attrition, grinding the ukrainians down and depleting their military supplies, all in a bid to minimize civilian casualties and destruction of infrastructure. Personally I would not have gone that route, whether I believe these people are my brothers are not, try to deserve their fate, and I would have leveled Ukraine to the ground. Either way, Ukraine has no way to win this war, they are outgun in every capacity by Russia, they exist merely by Russian restraint. The war will be over soon and Russia will have its victory.
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@Spacedog79 I would agree with most of that. However I would disagree about the financial sector controlling the political landscape, the West has always been a plutocracy, and that was for the best. However, that plutocracy was made up of men who owned businesses that produced real things, sure the financial interest was always represented, industry requires quite a bit of capital, but that Capital financed real production. Over the last 70 years, the West has become more democratic we see this in the United States with the introduction of the primary system, whereas before party bosses appointed the candidates representing each party in an election. We see the same in europe, with more Grassroots organization of the masses and they said selection of candidates, all of this has made for a messy and disruptive political sphere. As we learned from the 1930s, unbridled democracy in the west leads to populous fascism, to the left or to the right it doesn't matter, the masses are easily pimped by those promising free things and retribution.
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@rotinoma what China has is a massive amount of capital, willpower, and a huge domestic market. China is looking to recreate the entire semiconductor supply chain within its borders, both for security and economic reasons, and will succeed in doing so. There are a number of additional factors that will determine whether or not Chinese production will undercut the rest of the global marketplace, you must remember that China is as large in population as the the entire developed Western world combined, I regard Latin America as Western but underdeveloped, so that is a possibility. The existing supply chain could continue to exist to supply South Korea and japan, and you could even have a situation where manufacturers use Chinese Source chips for products destined for the Chinese market and countries friendly to china, while using non Chinese Source chips for Western countries and countries antagonistic to China. However if this proves to be a major price disadvantage, the lower cost for advanced technology rebounds to China's benefit.
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@thealienrobotanthropologist okay, let's drop the conspiratorial populous cloak.
The Western Elites are first and foremost western, and proud chauvinist, they don't hate their countrymen, they indulge them, and that is the problem. The Western Elites have bent over backward to accommodate their mass, and that is why they are in the trouble they are in. After World War ii, Western workers were given extremely indulgent pay and benefits packages, far beyond anything that could be supported by the productivity of the workforce. Hence, globalization is a response to try to prop up living standards Beyond productivity, by sourcing production from lower cost countries. All of this is made possible by artificially high value of Western currencies relative to their non-western manufacturing peers. Because global trade is priced in us dollars, will support my commodities, and the US will support the currencies of other Western countries, non-western manufacturing countries are forced to devalue their currencies, propping up Western living standards, in order to be competitive.
What are the bloated balance sheets about, what are the deficits, and the debt about, it is social welfare spending, it is the government employee, it is the free social services, all these things are for the masses, not the elite. Sure the Western Elite have made money as they can from globalization, from the asset price bubble, but the insolvency in Western economies comes from indulging the masses, not the elite. The lack of savings, the welfare benefits, the wages of a productivity, the demands of the unions, the lack of applicable job skills, these are all choices of the masses not of the elite.
When we speak of a multipolar world, we are speaking of a world in which there are more than three nations that can hold their own economically and technologically, and that is not likely to happen sure you can close your doors, but that does not mean that you will have the domestic savings, talent, or willpower to be a manufacturing and technological powerhouse on your own, and without that you will not have the economic gravity to be a pole in a multipolar world.
The increase hostility toward China is the growing realization and the part of the Elites in the west that China is going to displace them because they cannot and will not discipline their mass. The Chinese Elite have no problem whipping the mass of China into shape. The Chinese have domestic savings, they have high productivity, wages in line with productivity, and real investment on hampered by lobbying and interest groups. The West has thought it could curtel China's Advance by controlling the supply of natural resources, largely by destabilizing africa, but Russia stands prepared to supply China with all of the natural resources that it desires. With an alliance between Russia and china, and China's own internal discipline and focus, the Western Elites have no ability to stop the growth of china. And it is culturally, politically, and economically impossible to revive the fortunes of the West because they don't have the stomach to put their mass in line.
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