there will be no equilibrium, I don't thing there ever has been either, but I opted to bypass that one.
So in the 20-30 years it takes the developing world to catch up, what will we be doing?
There is another factor though - there's far more Chinese people than there are Westerners. So if they all demand loads of consumer goods there won't be enough of us to make them for them, will there?
On p1 someone was muttering about politics and viewpoints.
Thats dead easy . We all have ideals until it applies to us, then we are greedy!
Re other countries.
If there is not enough to help all then our own interests must come first. Thats the rule of nature and messing with that screws things up.
Of course it may be in our interests to feed starving millions to stop them becoming fundamental terrorists who cost us millions in security.
Who knows?
Tis cobblers the lot of it!
Oh yeah Buy British where it goes to Britain and buy local rather than from the next county.
I'm not sure I see the logic that we have to get poorer as other countries get richer. Living standards have increased dramatically in the UK over the last century. Over that period they've also increased just as dramatically in the rest of Europe, USA, China, India etc Not sure about Africa, but I'm struggling to see evidence that one country has to get poorer in order for another to get richer.
They don't thats the point of trade! 😉
If we import a lot of stuff, does that not mean that we're selling a lot of GBP and buying a lot of other currencies? This would weaken the pound and lead to a more competitive home market and a stronger export market. So long term good?
I think this summed it up on page 1 before the argument went round in circles. If we all bought British the £ would gain value, meaning those same companies we're suppourting wouldn't be able to export, so their prices would rise to try and make a profit from a small market (supply and demand curves), then eventualy enough people would be buying non british products that the £ would drop and they could export again.
In reality it's not going to swing quite to those extreams, governments and national banks are there to try and prevent that (although occasionaly fail, Japans lost decade, Zimbabwe's runaway inflation), it's an equilibrium with constantly shifting inputs.
That's why it's an issue that China is (allegedly) artificialy manipulating it's currency to make it's exports super competative, it's keeping the system out of equilibrium, and when that happens it usualy heads for a crash. Foe example american protectionist policies of the 1920's meant they had a huge domestic market for their goods. Unfortunaately once everyone who could afford it had bought their Car/tv/fridge there was no longer a market, and those same policies which had lead to the boom, left them with no export market for all those goods.
I'm not sure I see the logic that we have to get poorer as other countries get richer
You're right that it's not inevitable, trade creates wealth (the whole is greater than the sum of the parts).
But there is only so much raw materials, mineral resources, land to grow food, energy capacity and so on. As demand increases it will outstrip supply (I think) and the price goes up. For the people falling out the back of that process, that's poverty.
My hunch is in reality there's not enough to go around (for 'them' to all live at the same standard most of 'us' do, or even anywhere near it) and there is a big crunch coming for us.
"But there is only so much raw materials, mineral resources, land to grow food, energy capacity and so on. As demand increases it will outstrip supply (I think) and the price goes up. For the people falling out the back of that process, that's poverty."
This is correct. I believe that it is one of the drivers for sustainability. Economics on its own does not encourage sustainability, it has to be considered with social and environmental aspects also.
My understanding is that the Chinese aren't too worried about the outside market now.
While labour costs have gone up and conditions improved, it's created an affluent middle class with a love of western goods that they produce. In a country that's relatively debt-free, it's apparently basically self-sufficient at the moment.*