Comment 6560

By trey (registered) | Posted May 03, 2007 at 10:02:29

If we look to the past, the Great Depression was brought on (one reason) by over-production. Too much was produced and not enough was consumed. Even food, milk poured into ditches while people starved to inflate prices.

It's fair to say a similar scenario will happen to Chindia. Their massive producation capabilities will have to be shut down, like the 1930s. Prices will bottom out to ridiculously low levels and still have very little demand for cheap plastic dodads that have no purpose in our lives.

Unless Chindia turns its own population into consumers. To do that, Chindia will have to start paying living-wages. Like Henry Ford who wanted his own workers to be paid well enough to be able to afford the very products (Model T) they were producing.

Then Chindia looses its economic advantage of being the world's manufacturer from low wages.

O what will the world do?

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