Author: abramicus

THE REAL "CHINA DREAM" IS TO FIGHT FOR TOMORROW EVERY SINGLE DAY. [Copy link] 中文

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Post time 2013-4-17 14:42:30 |Display all floors
This post was edited by abramicus at 2013-4-17 14:45

TIME TO STRAIGHTEN OUT THE WESTERN ECONOMISTS USING PLAIN COMMON SENSE - PRODUCTION, NOT CONSUMPTION, DRIVES GROWTH!

If you produce 3 pairs of shoes, but use only 2 pairs, you have one extra pair that you can sell to others in exchange for things you need but do not have, such as a coat for example.

If, on the other hand, you use 2 pairs of shoes, but produce only 1 pair, you not only have no surplus to use in exchange for things you need, you will have to walk barefooted half the time as well.

The former illustrates why productivity is the source of growth and prosperity.  The latter illustrates why consumption outstripping production is the surest way to poverty and vulnerability.  Yes, some degree of consumption is needed in order for production to be rewarded, but when consumption leads production, you only get poorer by the day, and growth becomes impossible.

China should return to its productivity as Number One policy.

Consumption should always be a distant second to Production, and a very distant second!  China should produce twice what it consumes, or consume only half of what it produces.  When supply exceeds demand, production naturally ceases.  But until then, everybody gets a chance to live the good life, even if for only a few weeks before the market tanks.



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Post time 2013-4-18 13:45:27 |Display all floors
This post was edited by abramicus at 2013-4-18 13:56

WHINY Jonus, YOUR economics of consumption as the driver of production is what makes no sense at all.  Wealth comes from surplus, not from deficits.  The only reason the US can prosper while running a deficit is because other countries depend on its currency to buy and sell to one another.  As the producer of the medium of exchange, of course, the US can prosper without having to produce anything, because it can always exchange its currency for anything that the rest of the world trades.  Using the US as an example shows your insincerity or rather, your stupidity.  

China does not need stupid economists running its economy to the ground.  China rose up based on productivity, not consumption.  If other countries will not buy what China produces in excess, which is impossible if their markets are free, because by sheer volume, these exports should be cheaper than what they could produce themselves, then China should allocate its excess labor toward longer term production goals, such as producing more basic scientists, more writers, more artists, who can enrich the experience of life of its people without having to depend on the intellectual products of other countries, and on the artistic talents of other peoples.  Yes, surplus without exporting it still enriches China.  But deficit, even without importing anything poors every Chinese, materially and intellectually.

Production should always lead consumption in any society, except the very few which can simply produce money, rather than earn it.

Furthermore, China has every right to set the exchange rate it pleases for its currency.  It is a free market.  If the world disagrees, it can refuse to buy Chinese currency on the cheap, and end up buying Chinese goods on the dear.  China does not need exports to prosper.  But China needs growth and production to prosper.  This distinction is important if China's standard of living is to continue to rise, and its GDP continue to grow.  Production must always lead consumption.  

If China cannot produce goods and services that other countries will consume, then produce scientists, artists, philosophers instead.  Producing top quality people is the highest form of production any society can attain.  When you produce basic scientists, you make China smarter by leaps and bounds.  

THIS IS CALLED HUMAN CAPITAL, THE ULTIMATE FORM OF CAPITAL THAT CHINA CAN AND SHOULD PRODUCE BY THE MILLIONS, WITH ITS SURPLUS MANPOWER AS BASIS.

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