Re: [OT] Slumdog Millionarire: Glorifying India as a shithole just like many RSC freaks

eusebius wrote:

No massively exporting country can continue growing consistently
without a major correction- if for no other reason than world demand
cannot increase indefinitely. Certainly not in the current climate.
The guts have fallen out of China's major export partners- China will
experience (is experiencing) a major contraction. Australia, a major
supplier of materials to China will inevitably go down the tubes also
(it is only really starting to happen here).

However, Australia does not face the prospect of a social and political
collapse once the economy starts sputtering. China is going to be in a big
mess if the demand does not recover quickly. Numbers are hard to come by,
but I have read that the closure of many Chinese factories has already led
to about 1-2 million workers being laid off since just before the Chinese
New Year. Given that this is a country with an obsession with secrets, the
actual number is likely to be higher.

This can only result in a further increase in public unrest (farmers'
protests have been on the rise since 2004), with a predictable clampdown by
the authorities. Which means that the grand Faustian bargain made by Deng
and the Chinese people after 1989 faces the possibility of unravelling.

Further up north, Russia is hurting badly, and it has led to the first
significant decline in the popularity of their oligarchical-quasi
dictatorship of Putin and Medvedev (10 points in 2 months). Again allowing
for Russia's checquered history with public facts, that number could be
higher.

If I were Russia or China's neighbour, I would be very very nervous. Last
time (1962), China invaded India when things went bad at home for them
(they had just lost Soviet patronage and had started on the Cultural
Revolution). I think that a serious stiffening of our northern defenses and
raising our nuclear deterrence posture is in order. Hopefully, nothing will
happen, but its far better to be secure than (very) sorry.

I think that India and China's growth (the latter is severely threatened
right now by the near total collapse of demand in the West) will last
until another country / continent with suitable human resources steps
forward to take on the role of the producers and sufficient increases in
living standards create in India and China, 3 billion hungry consumers
with a poor savings ethic.

Hard to save when you are hungry. I don't see anyone supplanting India
and China in the near future, the problem is as you say the collapse
of demand.

Not entirely true. Even rich and middle class Indians tend to save
obsessively. This is cultural, which economic inducements will weaken over
the coming years.


Forgive me for quoting out of context, but are you conflating the
'patronizing nonsense of the American left' with 'Bushian nonsense'?

The first is an allusion to a time honoured tradition in the American
left (you should have watched the debates in the US Congress on the
nuclear deal to see how patronizing these self-styled do-gooders can be
towards the third world or even countries in G15/20). The second is an
allusion to the economic policies of the Bush years that used
artificially low interest rates and lax lending standards to get the US
out of the collapse of the IT bubble and later as a panacea for all the
financial ills wrought by the collapse of the manufacturing middle class
(which was a bipartisan effort in itself).

FWIW, I agree- it just did seem that you were juxtaposing the 2 and
essentially making them equivalent (ie Bushian and left ideas). Mind
you, the Clinton administration was pretty laissez-faire economically,

Their landmark disasters - the granting of permanent MFN status to China,
and the signing of the Glass-Stegall act came towards the middle/end of
their term. The effects of those strokes of genius only started being felt
a little later as the IT boom worked itself out. Of course, the Bush
administration just removed the floor from under policy stupidity, and
created the perfect economic storm of recession, loss of manufacturing base
and massive deficits through runaway spending and massive tax cuts, but
some of the seeds of these were laid in years before they came to power.
However, I hasten to point out that the two Clinton disasters I listed were
primarily Republican ideas, staunchly opposed by most of Clinton's base,
but triangulation was his game, and with the support of Republicans, who
controlled the Congress and conservative / third way (DLC) Democrats, he
did partake in those monumental stupidities.


As long as human population is increasing and there are regions of want
anywhere in the world, economic growth is necessary. If you know of a way
to usher in paradise, let others in on it.

Yeah, growth isn't bad, but it can't be unlimited, and it shouldn't be
pursued at any cost, surely we agree on that. Growth ultimately may
only be limited by Earth's resources, but it should reflect reality
also. The recent boom was I think the most artificial global boom
ever, hence we are looking down the barrell of the 'Great Depression
#2' or maybe the 'Greater Depression'

Agreed, since there were no tangible assets acquired by the US during this
period of GDP growth. Unlike the prior booms, like the IT boom, all this
has left behind is mountains of worthless paper.

I read a report the other day, that after accounting for the "irrational
exuberance" of the housing market, the purchasing power of the American
consumer has only decreased slightly in the last 10 years.

Pretty damning.


Quite so. Maybe the way around it is to change the profit/loss reporting
frequency for companies from every quarter to every year or so. Might
even force these golden boys to take a slightly longer term view.

Yeah. I get the feeling that you or I could handle these kind of jobs,
with a lot less risk :-)

I am not cut out for it. I find finance boring.
.

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