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Are we ready for this?
| Fri, 10-10-2008 - 9:41pm |
The Beginning of the End
Peter Schiff, President and Chief Global Strategist
| Fri, 10-10-2008 - 9:41pm |
The Beginning of the End
Peter Schiff, President and Chief Global Strategist
I agree to the author on many points and I knew this would happen some day.
Yes, China might be hurt temporarily, as will the rest of the world, but China has a population of 1.3 billion people - their population can absorb what they've been exporting to the US. Incomes in China are rising, and they have a savings rate of 50% as opposed to the negative savings rate of Americans.
72% of the US's GDP is consumption and roughly 90% of the goods in the US are imports. Every country that has been exporting goods to the US will find other markets (Russia, China, India, Brazil, etc.), but without exports the US economy will struggle to recover.
except China is on the same plan as the US consume consume on credit, in 10 years will they fail?
"except China is on the same plan as the US consume consume on credit, in 10 years will they fail?"
Actually, this isn't true - China's credit consumption is virtually non-existant. If that doesn't change there is no reason to predict they will fail in 10 years. As an emerging consumer economy, China is growing at an incredible pace, GDP growth is 10% per year.
"They can't export something their people don't buy"
Sure they can.
"they don't buy toys"
I'd find that pretty hard to believe, they have money and children, why wouldn't they buy toys?
"What market will replace America's consumerism?
No I kid you not on the toy thing, American purchases about 70% of the world output on toys.
There are certainly production and quality control issues,
I've been saying these things since 2001.
I look at it very simply. Good parents let their children learn by their mistakes. It's called natural consequence. The same should be done in this situation.
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Trolls often have personal issues that lead them to try to control others