Chinese Threats
I have been wondering about China. Especially the threats to America over arms sales to Taiwan. And I wonder if the threats aren't mostly for internal consumption. What made me think of this was the popping of China's real estate bubble.
Why internal consumption? To justify a large army. And why a large army? To handle unrest caused by possibilities such as:
Wow, China fighting inflation with predictions of 50% commercial vacancy rates in Beijing, Japan is Japan, Vietnam is worried about their Dong, and Europe and South America are a mess - it looks like it’s up to America to save us because, as I said earlier in the week - do you really have anywhere better to put your money?China's government depends on growth to keep the population pacified.
What about the big picture? The world has been generating more capital than it can profitably employ. Which means we are under invested in research. Which is the cause of our secular decline.
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1 comment:
I see a lot of articles claiming that the U.S. is dependent on China because they make so many of the things we buy. The problem for China is that we buy so many of the things they make.
The U.S. made the transition from "developing nation" to "developed nation" during the 20's, 30's, and 40's. It remains to be seen if China can do the same without undergoing one of their periodic dynastic upheavals.
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