Gerald Celente on KFNN 1510 with Ken Morgan on December 29, 2009.
(Interview follows excerpts and commentary)
“Actually, it’s going to be global. Not made in China is going to be something on a lot of peoples’ minds. It’s the golden rule – those who have the gold rule. With all the money going to China there’s a lot of concern.
You have countries like Indonesia, a very poor country, that can’t even compete even making nails, which are basically made out of wire, compared to China. So, you’re going to start seeing trade protectionism going up around the world.”
There is almost no doubt that Gerald Celente’s call for a “Not Made In China” trend will take off in 2010. When a country’s economy starts imploding, they will almost always blame another country for their woes. In this case, we have China essentially using slave wages to manufacture low quality goods at hyper-cheap prices, making it almost impossible for any other country to compete. The response by most governments will be 1) protectionism 2) debasement of their currencies in order to become more competitive.
With point #2, because of China’s currency peg, there may be difficulty for the US using this method to compete with China, but it does make the US more “competitive” insofar as pricing is concerned with other countries, for example those in the EuroZone.
China’s response will not be amicable.
In When China Pulls the Peg, Cardiac Arrest Will Follow in the USA, I opined:
I firmly believe we are engaged in a global war. No missiles have been fired yet, but perhaps at some point in the future they will be. Or, it may end similar to the Cold War, where the USA completely destroyed the economy of the Soviet Union through a variety of methods, namely by forcing them to spend billions to keep up with our defense spending. Eventually, the Soviets were bankrupted.
Sound familiar?
This is economic warfare folks, whether you want to believe it or not. And we’re all playing for keeps.
Listen to Gerald Celente:
It Took 22 Years to Get to This Point
Iowa's governor Kim Reynolds has extended that bird flu "disaster declaration" after the virus was...
President-elect, Donald Trump has announced that he will enforce tariffs on Mexico, Canada, and...
This article was originally published by Michael Snyder at The Economic Collapse Blog under the...
The state of California has killed around 8.4 million birds in the past month during the current...
Commenting Policy:
Some comments on this web site are automatically moderated through our Spam protection systems. Please be patient if your comment isn’t immediately available. We’re not trying to censor you, the system just wants to make sure you’re not a robot posting random spam.
This website thrives because of its community. While we support lively debates and understand that people get excited, frustrated or angry at times, we ask that the conversation remain civil. Racism, to include any religious affiliation, will not be tolerated on this site, including the disparagement of people in the comments section.
great article. i have memories of my grandparents always buying American, and being proud of it. i try to do that too, to some extent. but, unfortunately, i have found that there are some areas in which the U.S. just hasn’t been able to compete. technology, specifically. my car is asian, because i like the idea of high mpg and a long lasting life with low needs and cost for maintenance. my computers are all asian made as well.
i know that the U.S. is making a concerted effort to compete in these arenas, especially in the auto market – but unfortunately there is no incentive for me to pay more for the same (or even lower) quality.
the bottom line is that i (like most americans) care more about my dollar going far than going to the U.S. economy. sadly, the secondary impact of this is that we continue to make inferior products, since we have less money to devote to the development of those products. so, if it really is war, how are we going to get around this? (or did i completely miss the point of this article?).
Soz, I think you did get the point of this article. The fact is, that you, me and everyone else could be considered ‘soldiers’ in terms of economic warfare… we are the front line. When we Buy China, we are helping them ‘win’, if you will.
We can, of course, stop buying Chinese goods, and if every American did that China would be screwed. But, like you said, your dollar goes much farther in terms of buying power and sometimes quality, especially when we are talking about cars.
But this translates to good like clothes and appliances too. The Chinese make these goods cheaper, for a number of reasons, one of them being the dollar peg, the other being the wages that the average Chinese worker makes.
Are Americans willing to work for a few dollars a day? no way. Thus, we cannot compete in that way.
Are Americans willing to pay 20% more for clothes just to support our side in the war? maybe some, like your grandparents, but most have to shop on the cheap because they are getting hammered by taxes, rising food costs and significant losses in their retirement accounts and homes.
So, the governments will likely move to protectionist policies. Tarriffs and taxes on imported goods, as well as depreciation of our own currency to make us more competitive. I suppose by debasing our currency, you do make American workers more competetive, because the value lost in the dollar will more than likely not be made up by wage increases. So, what was $10 an hour today in terms of buying power, may only be $5 an hour a year from now.
This is where we are headed, I think.
Of course, it is much more complex than this, but that’s the jist of it, more or less.
What is the solution? Heck I don’t really know because I’m just an anonymous blogger with a background in economics, other than maybe letting Americans keep more of their money, reducing taxes on small businesses and corporations so that they can make products cheaper, and perhaps limiting credit expansion in the future so that there is not a bunch of “free” money out there that forces prices higher. (Rick Blaine had a comment where he briefly mentioned free money pushing prices higher here : https://www.shtfplan.com/bob-chapman/chapman-will-we-look-like-weimar-zimbabwe-or-argentina_01022010#comment-9631 )
Thanks for the article. No truer words were ever written: “In this case, we have China essentially using slave wages to manufacture low quality goods at hyper-cheap prices, making it almost impossible for any other country to compete.”
Soz’s comment reminded me of my first “buy American” fervor back when I was in college in the 1980s. Back then it seemed like the Japanese were buying up America. There was an anti-Japanese product backlash. I only write this because…wow…people have been warning us that it is against our personal and national interest to buy so many foreign-made goods for a long, long time to no avail.
The large multinational corporations have been trying to brainwash Americans for nearly 30 years that we must scrap corporate pension plans, export jobs, bust unions, etc. so that they can compete on the global stage. It was always a lie. Americans could never compete against Chinese workers making slave wages, poor or no benefits, and social security benefits. Chinese workers toil for peanuts. The multinational corporation’s aim was always to lower overhead expenses to maximize profit. Workers and the environment have paid a heavy price for unchecked Capitalism motivated by ever increasing profit and ever decreasing labor and production costs.
There are many American companies that see the value of operating in America and hiring local people because those dollars go out into the community.
More than “don’t buy Chinese” I would urge people to not purchase products from large multinational corporations. Look for “Made in the USA” labels and support Mom and Pop stores. Those quality, American made products will cost more, but you will know that you are supporting communities in your nation.
For example, I’m aligning my spending with my beliefs when I buy a pressure canner next month. It’s made in the USA, “industrial strength,” built to last and is priced accordingly. But it’s the first and last canner I’ll ever need to buy. Too many people buy cheap stuff just to have such and such item right away. If you factor in the replacement cost as those cheap items wear out, then it’s actually cheaper, probably, to buy the top-of-the-line quality item the first time around. Cheap stuff is usually made of plastic where you and your family are also exposed to toxins leaching out of plastic. Things made out of wool, organic cotton, stainless steel, iron, aluminum, etc. can last a lifetime with regard to the metals.
Something studied in Buddhism practice really stuck in my mind. The Buddha said that one of the keys to happiness is freedom from want. As far back as I can remember to when I was little kid, I always wanted “something.” I think many people can relate because most Americans spend every cent they/we make, and 60-70% of the USA’s GDP is from consumption of goods. I set about exploring ways to simply want less. In meditation I realized that many times the anticipation was more satisfying than actually having the item–so what was that all about? In our American society we are subjected to so much advertising. I stopped watching/reading advertising a few years ago now and I am much more content. Of course I still shop, but I no longer “crave” or impulse buy as much. Maybe as Americans we could simply want less. Right way I can hear mainstream people saying that if we purchase less the economy will fall. Well, I think the economy might get tougher for the multinational corporations and some Chinese might be out of a job if production is scaled back. The multinationals don’t operate in America in any meaningful way so their loss of profit and viability is on them. If we want less, and what we do purchase is from American-made businesses then our, American, economy for the average citizen might be just fine. You are supporting American businesses, paychecks go local Americans and those dollars go to local businesses.
P.S. I listened on DemocracyNow! this morning about how there is a grassroots movement beginning urging people to move their money from “too-big-to-fail” banks to local or regional smaller banks. If you can’t get Washington to offer real reform on Wall Street you can take direct action and move your money out of those banks. I’m already with a smaller regional bank. I urge everybody to research the smaller, FDIC-insured banks in your area and move your money to them, instead of the bailout banks.
Hope my post did not make it sound like I think I have the answers to these complicated problems, because I do not. It’s just that this foreign-made products backlash has happened before targeting different countries. China is just the current target of popular anger. Some corporations won’t even go into China anymore because they say it’s not a cheap as it use to be. They are eyeing the former Soviet block nations for cheaper labor. People are blaming China for some of our economy problems. My point was that is isn’t China, it is and has always been the multinational corporations that setup operations in China, so let’s aim our anger and actions at the real enemy by altering our purchasing decisions away from those companies. I understand what you wrote about American-made cars. If I ever were to ever buy a car it would not be American-made…sadly. It’s directly in the interest of every American to simply want less.
Greg fantastic comment.
“In meditation I realized that many times the anticipation was more satisfying than actually having the item–so what was that all about? In our American society we are subjected to so much advertising. I stopped watching/reading advertising a few years ago now and I am much more content. Of course I still shop, but I no longer “crave†or impulse buy as much.”
You are absolutely right about the craving.
The products we buy, in most cases, we just “want”, not need. I have found that simply picking a product up, looking at it, engaging with it, even telling myself a story about the fun I am having with the product, helps me to enjoy it more than actually buying it. The best example of products that go to waste is the toys my kids get. They are super excited when they pick it out, even more excited when they open the box… they play with it for 10 minutes and then you never see it again. Adults are the same way. Personally, I after many years of engaging in my product interaction technique from above, I have found that just interacting with it in my mind is much more fun than actually owning it — for the most part.
PS — on the banks, i would recommend for those looking to leave the too-big-too-fails, check out Martin Weiss safe/dangerous bank lists. In fact, I will do a post on this later today and link out from here to there.
UPDATE 3:15 PM: Here is the Move Your Money post: https://www.shtfplan.com/headline-news/give-em-hell-america-leave-your-too-big-to-fail-bank_01042010
Mac Slavo,
True that!! That’s interesting that you found that just interacting with a product in many instances was more rewarding than buying it. I’ve taken to doing that also, especially with clothing. I’ll carry the item with me as I walk around the store so I can interact with it and look it over a bit more. Most of the time I’ll put product back and feel great when I walk out of the store without buying anything. 😀 Ya here that Madison Avenue? I feel great when I don’t spend money.
I’ve taken to doing a similar thing with an online retailer. I add the item I think I want to my shopping cart. Once there I can think it over more, read reviews as I have time, and compare similar products. At least 50% of the time I eventually decide to delete the item from my shopping cart. The things I do buy might have been in my shopping cart for months until I decide that now is the right time.
Thanks for the link to the DemocracyNow! segment. I’m going to go listen to it again right now.
“Gerald Celente’s call for a “Not Made In China†trend will take off in 2010“ – Maybe, but to support such an idea is to be ignorant of economics and Ricardo’s Law in particular.
“When we Buy China, we are helping them ‘win’, if you will.” – In fact, we both win. If I buy a toy from a Chinese supplier, it is because I value the toy more than the cash. Likewise, the supplier values the cash more than the toy. Obviously, we both benefit. Otherwise no mutually agreed exchange would have been possible.
“In meditation I realized that many times the anticipation was more satisfying than actually having the item” – Your subjective preferences motivate you to act by meditating as opposed to, say, shopping. You are still acting based on desires. “The Buddha said that one of the keys to happiness is freedom from want” – A person free from want would have no motivation to act in any way. They would lie there lifelessly. They would cease to be a human being.
“there are some areas in which the U.S. just hasn’t been able to compete” – That’s odd. We seem to be excelling in many areas. For example, in printing fiat currency: we’ve destroyed over 95% of the value of the dollar. No one has killed more people with fusion weapons, or has so many per capita incarcerated as we do. Madoff is like a child stealing a piece of candy compared to the Ponzi scheme that is US social security. Not even in China does the government own as much of the economy as in USSA. I can’t imagine why we can’t compete more effectively in a free market.
“there are some areas in which the U.S. just hasn’t been able to compete†– But we do have the best maintained landscape in the world. For example, you can go to jail for having a brown lawn:
http://blog.mises.org/archives/007183.asp
And in the Land of the Free, watering your lawn can also land you in the clink:
http://www.tampabay.com/news/weather/drought/article981572.ece
I appreciate you comments. Seems you listed several areas where other nations cannot compete against the USA.
I am a humble student of Buddhism and my understanding is no double incomplete. Buddhists refer to “their practice.” The Buddhist teacher I listened to often spoke about “when you can remember to work your practice.” The teachings are goals in which you try to move closer towards as you can remember to put them into practice in your everyday life but few people ever achieve.
I meant the comment about “a key to happiness is freedom from want” as freedom from over consumption. I used that teaching to focus my mind with gratitude on all my Blessings and that I have everything I need. It’s a journey and not a destination. I still want things, but I want fewer things. I don’t give in to impulse buys and manage to live within my means.
That’s my New Years wish for all. To look with gratitude on all the Blessings we already have in our lives. The best things in life are not things. But, when we do buy things, because we will, maybe we can find good-quality made the USA options.