The Glade 4.0

Inflation in US dollars will be extreme. There will soon be no compelling reason for them to bring this money home. Sell a Chinese fellow a coke for 30 yembimbei (or however it is spelled) and leave it there either to pay employees in your factory or to invest in their market.


No you said our deficit is increasing because we are importing more goods to keep pace with increased consumption. I am saying consumption is either flat or declining and the trade deficit is increasing because less goods are being made here.

You have a fundamental misunderstanding of economics. This is not a zero sum game. You can produce more cars to meet demand, you don't need to reassign goods allocation.

What? How...? ....
Why does China have a housing bubble? From lack of demand and money right?

Make up your mind. You started the sentence with emerging markets and throw in Europe as an example? How about India instead?

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Of course there is. If nothing else, they have to pay people to manage the operations and run the company. If the company expands because of Chinese profits, they will need more people to do this. If this money comes from non-Americans then the US is getting richer.





I didn't say anything about increased consumption. Regardless, that's not even relevant to this. You have essentially claimed that even as US companies sell more products to non-Americans, the trade deficit will increase. This is absolutely impossible, zero-sum or not doesn't even enter into it. If a US company pays a Chinese person $5 to make something and then sells that product to another Chinese person for $10, Americans have $5 more than they did before. You are absolutely going to need to explain how US companies selling products to non-Americans somehow causes the trade deficit to increase, because it doesn't make sense.



When you have a trade surplus, your currency increases in value. Or in our case, a reduced trade deficit would make it lose value less quickly, but it's the same concept.



http://www.dailymail.co.uk/news/article-1339536/Ghost-towns-China-Satellite-images-cities-lying-completely-deserted.html



When I said "emerging market," I was referring to your assertion that there would be new export markets for US products that there weren't before.

Why are they staffing people in America when the production is over there?


Where did I say anything that could be misconstrued as that? See the next point.


Let's go elementary here: If I buy an apple that was grown in Ohio that is neither an import nor an export and is neutral to the trade deficit. If we burn the Ohio farm down and move apple growth to Mexico and I buy an apple that is now an import and increases our trade-deficit. That is what we are doing. All of our production is moving off-shore so everything we buy is an import, we aren't buying MORE we are just making LESS stuff here.


Where are you coming up with this idea that the trade-deficit is going down?


What does this have to do with anything? This is the equivalent of saying that housing prices in Manhattan should be cheaper because there is real-estate in Utah.


So Europe again ties in to what exactly? Are you asserting that China's and India's economies are NOT in fact growing in double digits yearly?

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I don't know, the company is still headquartered in the US, that means they must get some benefit from employing Americans to do something. If they didn't, they'd just move the HQ to China and set up shop there.



When arguing with Kaffis you stated that US businesses would have, at least in a relative sense, increased revenue. In post #8 of this thread you explicitly stated that the customer base responsible for this increased revenue would not be American.



Yes, this is all true. However, in this scenario the consumer of the product is American. You stated earlier (post #8 again) that the ultimate consumer would NOT be American. If the consumer is not American, it falls apart. If my business is selling apples to Canada, it does not matter whether I grow them in Ohio or Mexico, I am still generating a net gain for the US.



I'm not coming up with this idea. The trade deficit decreasing follows from what you say will happen, I'm using the fact that the trade deficit is actually increasing to dispute it.



You have said that a significant non-American consumer base for American companies will come into existence. I would like to know where this will come from, since Europe and China are both about to drive their economies off a cliff.