The End of Chinese Manufacturing?

There is so much going on in the world it’s impossible to keep up. Very interesting perspective.
 
Some very interesting perspectives
Interesting. Many of the same sort of things is happening in Russia. If a company made a big bet on the continued support of either economy, it will be very expensive. Our little hobby group will likely feel it in much higher prices and lack of products to buy. It may bankrupt companies that are nearly totally dependent on cheap Chinese labor. I didn't realize that Corvid vaccines in China were that much different in their effectiveness than in the west. Why wouldn't they just copy the ones in the west?
 
I didn't realize that Corvid vaccines in China were that much different in their effectiveness than in the west. Why wouldn't they just copy the ones in the west?
National pride.
 
That’s an accurate assessment. There are high level voices trying to get China to open up and let covid run it’s course, but Xi insists on a zero covid policy, so this going to continue for some time all across the country. The people of Shanghai are fed up with the government and the lockdowns. My mother-in-law has been a diehard supporter of the government, but even she is starting to question their competence. They are openly questioning why they are being locked down with so few deaths. Imagine a family of 4-6 (keep in mind many households have 3 generations living together) in an apartment the size of a suburban living room for 4+ weeks. My wife’s uncle was visiting his daughter in-law in a building in the same complex as he lived when the lock downs happened and he wasn’t allowed to go back to his apartment for several weeks. If there was ever a time the people revolt, this will do it.

Many companies in China have already gone bankrupt, there will be many more to come. We are going to bear a large part of the brunt of this due to our dependance on China for not only manufacturing, but raw materials as well. There are hundreds of ships anchored off Shanghai waiting to get loaded. We are finally catching up at the ports, once Shanghai reopens, there is going to be another rush of ships at our ports wanting to unload that we won’t be able to handle. It is going to be a long time before this straightens out. I would suggest stocking up on what you might need for the next year, you might find it difficult finding it in the near future.

In regards to the Chinese vaccine, a lot of people there refused to take it knowing the government rushed it out and did not trust it’s safety.
 
This is an eye opener.
I was aware of their over inflated real estate market.
You know, the one where working families invest in an apartment in some far off city where nobody lives yet continues to increase in value, year over year.
This bubble is going to burst with a loud bang.
We are printing money at an alarming rate and there is a planned reduction.
The debt is niw over 30 trillion, some say it’s more like 90 trillion.
It sure seems like the status quo is not sustainable.
 
Real estate prices in Shanghai are absolutely insane. My wife’s uncle had an apartment he sold in 2014 for $450,000. It had a living space about 12x12, one bedroom 10x12ish, the kitchen was 6x6, just enough room for a stove and sink, and a bathroom with a shower. We stayed in that apartment on one trip with two small kids, it was bad enough just sleeping in there, I couldn’t imagine being quarantined in it, would feel like a prison. I can’t imagine how much he would have been able to sell that for today. And that was 5 miles from downtown Shanghai, prices must be in outer space down there. I have no idea how Chinese can afford those prices, even with their parents kicking in as much as they can, that is still an obscene amount to try to finance on the low salaries paid in China.
 
Interesting video.

Something I've noticed the past 5 or so years is the price difference between USA made and Chinese made products. The USA made has held fairly steady while the Chinese products have exploded in price, first the tariffs and then supply chain.

In 2016 a Sherline lathe (USA made) was more expensive than the bottom tier 7x12" mini-lathe. Back then you could pick up a 7x12" Harbor Freight lathe for $499, less if you got it with a 20% off coupon. A bare bones Sherline package cost about $600. Today the HF 7x12" is $799, and the 20% coupons are pretty much gone. A bare bones Sherline package is still only $624, the price has barely moved while the 7x12 has effectively doubled in price (price plus loss of discount coupons).

You find the same thing with California air tools compressors vs Chinese made compressors. The assembled in USA (with some parts from Mexico) CAT compressors have held fairly steady and now compare quite well on price to what used to be much cheaper Chinese compressors.


This does not hold true for most electronics which rely heavily on imported chips and have seen prices climb rapidly. Glad I bought my Miller welder in 2019, because in 3 years the price has increased almost 40%.
 
Treat your smart phone gently and don't drop it
:)
What's going to happen with Precision Matthews? 2 year + lead times?
 
Real estate prices in Shanghai are absolutely insane. My wife’s uncle had an apartment he sold in 2014 for $450,000. It had a living space about 12x12, one bedroom 10x12ish, the kitchen was 6x6, just enough room for a stove and sink, and a bathroom with a shower. We stayed in that apartment on one trip with two small kids, it was bad enough just sleeping in there, I couldn’t imagine being quarantined in it, would feel like a prison. I can’t imagine how much he would have been able to sell that for today. And that was 5 miles from downtown Shanghai, prices must be in outer space down there. I have no idea how Chinese can afford those prices, even with their parents kicking in as much as they can, that is still an obscene amount to try to finance on the low salaries paid in China.
I asked about this a few decades back when I still lived in Cupertino, I couldn't afford a house and asked a Chinese friend. They explained it - 100 year mortgages and 3 or 4 families in a house.

I haven't watched the video but economics is a very interesting topic to me. Everyone wants things to be better for their kids than it is for them but world population has doubled since I was young. I think that those of us who are able to make at least some of the things we need, and repair, and grow food, will be better off than many.

Any economy that subsides industry to gain market share will eventually hit a wall....

John
 
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