Finance and Economics > Economic News, the Global Economy and all Things Monetary

Holding China's Feet to the Fire

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If it happens, it won't be for some time. Too many big businesses with huge amounts of money sheltered against taxes there and too much manufacturing moved over there.
Well beyond the plants here being closed for a long time, there are a ton of skill sets lost due to not being passed from worker to worker.
A good example I can give was the electrical generating station I worked at had to replace the "Main Power Transformers" for various reasons. These are the transformer that take the output from the generators and steps up the voltage to the electrical grid.
They had to source the new transformers from Spain which also required them to be modified to work with our systems here.
I say "had to" because there's no place left here in the US that makes these big transformer and no one left who even knows how. The old ones made 80+ years ago were built to last. When the demand for them dried up, they quit making them, closed the plants, and lost all the tribal knowledge. All that info and knowledge used before the creation of the digital age lost to time and decay, the workers very aged or dead.
I can still remember all the new engineers coming to the control room and seeing all the old analog relays. Fresh from college and they had no idea what they were even looking at, no longer taught in schools.

We can try to find non-China alternatives wherever possible... it will probably have to be a gradual thing. Just becoming more aware of that "made in China" label may help a great deal.

David in MN:
I think they stand to lose a lot. Yes, the average consumer might not like "made in China" but suppose the EU (which Italy has a seat at) and the western hemisphere start making travel from China a little harder... It breaks my heart that the innocent international businessman gets hurt because the CCP can't be trusted but thems the skids.

If we see a "significant" reduction in Chinese travel it's the world standing on its head. And we have a globe of people who span the annoyed (like me cancelling a vacation) to the grieved who saw family die. It's going to catch in our craw that the CCP lied to the WHO and let this out.

I'm curious how this plays out. The Chinese government was a bad actor on a global stage. It's one thing to have a pandemic. It's another to try to cover it up and lie to global partners.

The backlash is coming. We live in a world where the CCP has proven itself for being foundationally bad. That will effect business.

David in MN:
The Chinese government is now claiming they are over the peak. Then they re-closed movie theaters. So either something changed or they've been lying. Again.

It's a really sad state of affairs.

I saw a report from someone saying that the number of cellphone users has dropped by 21 million in the past two months. They say as many as 15 million may be due to migrants and pay for use type customers not using them during the lockdown. But another 6 million is not explained by that theory. It seems likely that at least some of those 6 million may also be virus victims that China isn't reporting.


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