What have not been reported extensively are the improvement of the Chinese products and why Chinese will compete with the best in the world.
The following article reports BYM company but it is only one of the many innovative companies in China. How can the west compete with the engineers in China working 12 hours a day at about 10% of the salary?
http://money.cnn.com/2009/04/13/technology/gunther_electric.fortune/index.htm
Culture, Society and Business
The principles of business transactions are based on cultural values. To define culture we must first know where culture comes from. Culture comes from a mutual interaction between individuals, groups, subcultures and societies. Values, ideas and ideology are passed down from one generation to the next. Gradually over time they adapt to change and outside influences.
A more sociological technical definition of culture is as follows: “the total, generally organized way of life, including values, norms, institutions, and artifacts, that is passed on from generation to generation by learning alone”. Thus culture includes tangible and non-tangible things where are passed down through the years.
The U.S. Fed chairman Bernanke gave some amazing recycled remarks to the International Monetary Conference on June 3, 2008. In that speech, he offered some gems of wisdom such as:
In the financial sphere, the three longer-term developments I have identified are linked by the fact that a substantial increase in the net supply of saving in emerging market economies contributed to both the U.S. housing boom and the broader credit boom. The sources of this increase in net saving included rapid growth in high-saving East Asian countries and, outside of China, reduced investment rates in that region; large buildups in foreign exchange reserves in a number of emerging markets; and the enormous increases in the revenues received by exporters of oil and other commodities. The pressure of these net savings flows led to lower long-term real interest rates around the world, stimulated asset prices (including house prices), and pushed current accounts toward deficit in the industrial countries–notably the United States–that received these flows. … The housing boom came to an end because rising prices made housing increasingly unaffordable. The end of rapid house price increases in turn undermined a basic premise of many adjustable-rate subprime loans–that home price appreciation alone would always generate enough equity to permit the borrower to refinance and thereby avoid ever having to pay the fully-indexed interest rate. When that premise was shown to be false and defaults on subprime mortgages rose sharply, investors quickly backpedaled from mortgage-related securities. The reduced availability of mortgage credit caused housing to weaken further.
As Mike Whitney so nicely summarized for Bernanke: “It’s all China’s fault. Really.”
Whew. That’s a pretty long-winded way of saying the Chinese are to blame for everything that’s gone wrong in the markets for the last 10 months.
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