Sunday, March 30, 2008

The Final Shoe on American Consumerism is About to Fall (China will be raising prices)

America's bedraggled, debt slave consumers are about to reap the final whirlwind which will finally unwind what is left of their consumer materialist society. This final shoe will come in the form of the cheaply made and cheap priced and often poisonous Chinese consumer goods. It is these very goods that not only have stuffed American households in a gluttony of soulless, Christless consumerism but have equally driven those same mindless consumers out of their middle class manufacturing jobs and into the lower class that make up the vast vast masses of service sector jobs.

Of course the fact that a service economy is a natural by product of a manufacturing economy is lost on those whose education is now a deteriorating 3rd world joke with a 1st world price tag and who listen to the likes of the Communist News Network (CNN) or Faux News, both corporately owned by a small powerful and government aligned (both parties) oligarchs.

But all that aside, and back to the subject. The Chinese are about to raise prices on consumer goods as they have already raised prices on metal industrial inputs. There are three reasons for this. First is the falling dollar. Turns out, all those pseudo calls to release the Yuan did just that and the Yuan, while still ballasted down not to rise to quickly, has risen 6% against the dollar. So that's 6% so far. Then we have the 9% inflation rate of today's China, which equally raises the prices of inputs (raw materials), work (ok, the Chinese slave wage is a joke so 10% more on a 25 cent per hour pay is still a joke at 27.5 cents) and overhead (paper pushers, electricity, energy in general, rent, etc). Finally, in order to combat an overheated economy, which is obvious from the high inflation rate, China has moved to cut back subsidies to it's industry (that's right all you Free Trade zealot fools, you're the only idiots playing that game, everyone else plays mercantilism...defending their economy). Seems that many of those cuts are up to 20% in nature and the suppliers have tacked that 20% right on to their prices.

So all told, so far, that's about a 30-36% rise in price.

Have not felt that yet? Do not worry, they are working their way up the manufacturing chain, as usual starting with basic inputs and propagating upwards. You will feel it soon enough.

What will an economy, the world's biggest debtor, already under strains of a 7-10% actual inflation rate (vs the 3% marked down liar rate of the Fed) and where consumerism alone makes up 70% of the economy, do?

Well the usual Fed policy of making more money sure as hell won't help the situation.

Good luck, you'll need it.

2 comments:

Laura said...
This comment has been removed by the author.
abigaildavid said...

Hello – I actually wanted to comment on your article that I read in Pravda – ‘American capitalism gone with a whimper’ but I did not easily find it on your site so I’m commenting here. I sadly agree with much of it. Admittedly it is hard to read or hear someone from another country say harsh things about your own country even if there is truth in it. I believe our nation has been blessed these many years not because any person in our nation discovered the perfect formula for government but because those founding fathers honored the Lord our God. (Blessed is the nation whose God is the LORD. Psalm 33:12) Years passed and just as we can see from the Bible – we forgot God…decided we didn’t need him and basically told him so by taking prayer out of schools and legalizing things that God himself calls abominations. And so what we see happening to day is not a surprise to those who believe the Bible. (Pride goeth before destruction, and an haughty spirit before a fall. Proverbs 16:18). Perhaps this time of trouble will cause many people to turn to the Lord. He is our hope. Spa-cee-ba.