It could quite easily be construed that China has set out to achieve the following - To dominate global manufacturing, and in doing so take ownership of the world's most wanted resources. The one true resource that China has over western nations is an unending supply of humans who are willing to work without any benefits for very little in return. The 'WTO' has insisted all western tariffs be brought down to distribute wealth throughout the world, but it has failed to ensure that it is done in a fair and ethical manner.
Who are the mugs? We are! We've ensured, by buying under-priced items, that our local factories have had to shut down. And now we want the Chinese to take over our resource companies all for some short term gain in share prices! This is just typical of us westerners - we are so short sighted that we cannot for once ever see beyond the dollar signs in front of our eyes. If it's good on paper then it should be okay tomorrow. If the item I'm buying is much cheaper than the Australian item then to hell with the economy I just want cheap now!
China has us by our meatballs. We are now no longer in a position to restore local manufacturing without much economic turmoil. We have to accept whatever they want for their normally cheap goods. As until now they have artificially suppressed their currency to dominate global manufacturing. But as it is now its citizens are facing very high inflation due to its very weak currency. But do not fear - China can quite easily raise its currency value which will do the following; It would raise the price of everyday items we buy from Target, Big W, KMart, Bunnings. It would reduce the profit margins of these retail conglomerates. It would mean less money would be distributed throughout the economy as retail workers would have their wages reduced by a big margin. The reduced income from lower retail profits would flow through the economy, creating an economic vacuum. The Chinese average workers would suddenly see themselves being able to afford more dairy, more wheat, more rice, more energy, more meat, more jewellery as their currency has appreciated. Their increased levels of consumption has meant that these commodities are much more sought after, which is reflected by much higher prices. Western inflation levels would then do the opposite of what it had been doing for the last 15 years; instead of importing deflation to the delight of consumers and politicians it would be importing inflation - do you c-o-m-p-r-e-h=e-n-d? Do you people actually acknowledge what it means once we start importing inflation? It means that the party is over - finito! No longer will the Costellos and Swans be able to play their interest rates chess games. They can raise interest rates as much as they think is needed - but it will never be enough once the costs of Chinese goods and raw commodities start rampaging through the roof! Oh yes, but we can start making our own good can't we? Of course we can. But we will never be able to make the goods we consume at the prices we currently buy at the counter. The goods we will make will have a wholesale price that would be much higher than the retail price of Chinese goods. No room to move. That is why the western leaders yield to the Chinese. The Chinese have full control in everything we do thanks to each and every one of us including me!
