Shout!

and when you add it all together
and when you roll it in a ball
and when you watch another pyramid
as it's about to fall
remember you were there
remember if you care
all those who held their ground
when it all came down
said shout shout

(Devo, shout)

Today’s China appears, on the surface, to be a thriving economy. In fact, at first glance China appears to be edging the United States out of our #1 status in the world economy. But China’s glamorous economic center-spread is just as artificial as those Sports Illustrated airbrush models. It’s a beautiful faḉade.

There are several factors in China that make me skeptical. First, we already know that China has a history of being less than honest with their record-keeping. If you’ll lie to yourself, you won’t even flinch when you pass the lie along to the rest of the world.

A bum we pull off the street wearing an Armani suit is still a bum. Sure, with a little dress and polish, we can probably pull a Pygmalian and pass him off among the aristocracy. But that image isn’t sustainable for any length of time because it isn’t real.

You gotta hand it to the Chinese. They maintain a great poker-face. But even a great poker-face doesn’t make up for a lousy hand, now does it?
Second, China uses slave labor in order to get an economic boost on their global competitors. This gives China a significant advantage because the rest of the world has no choice. They MUST actually PAY for their labor. For any operation, labor costs are one of the most significant expenses. The problem with the current Chinese model is that the advantage they boast is also not sustainable. Short-term, the slavery-model is producing unprecedented returns (go figure). But the guys cracking the whips might wanna take a few weeks of vacation and read about things like economics and world history.

Their model is doomed to fail. It will implode. The current Chinese model ignores the very core rules of economics. The #1 rule is that money must move in order to sustain any economy. Globally, China *is* moving money. But back at home, their economy is flat-lining.

As mentioned above, slavery simply doesn’t work. As worldwide demand increases for *cheap* products from China, supply lines will be stretched thin trying to keep up with this increasing demand. China will be forced to respond by, ahem, enslaving more people (ie, arresting more people for minor offenses so they can man those sweatshops with free labor). Historically, there is a breaking point. The people will put up with some abuse. The real question we should be asking is how many disenfranchised Chinese does it take to finally break the camel’s back?

All it takes is one little turtle named Mack…and a burp. And the whole thing comes crashing down.

Sun Wukong, The Monkey King

Sun Wukong, The Monkey King

Let’s face it, this monkey king character is kinda creepy, especially the clip where this freakish thing has that disturbing cackling, insanity-laden laugh. This strange hero would give my kids nightmares. So China’s great heroic figure was a psychotic monkey who waged war on heaven. Am I the only one here who’s befuddled by this creepy monkey-hero?

And now for the serious part of the blog:

This particular passage stood out from Gittings: “The journalist Liu Binyan wrote a fictionalized report, ‘On the Bridge Sit’, showing how a disaster was caused while officials waited for ‘higher instruction’ instead of taking decisions during an emergency. Liu was labelled a rightist. So was the young engineer who dared to make decisions on his own and provied the model for Liu’s story.” (Gittings, p. 49)

For me, the big red flag is the SARS scare back in 2002-3. I remember following that story. The whole world stood aghast that China had failed to report the disease to the world health organization. Their failure put the entire global community at risk. Personally, I just rolled my eyes at the time. I scoffed…China! That was pretty much the end of my commentary. These military wax figures in their ironed uniforms and their dead doll eyes made a few announcements. I grew up bouncing from one military to the base. I knew the drill. You get a face-man to act as a go-between. The face-man is always some guy who looks like one of those old-fashioned GI JOE dolls, fresh out of the box. They’re trained in non-verbal communication. That means they are trained to control their non-verbals as well as the vomitous spewing from their fetid lips. They have to control those non-verbals. There are people who watch those non-verbals like they’re reading a book. So those wax figures say what they want us to hear, divulging nothing more. But then they made a mistake. This woman from the CDC comes on to give us the low-down. She’s a scientist, not an expert in communications. She was the most nervous twittering thing I’ve ever seen. SARS scared the hell out of this woman. Her mouth said, “We’ve got it under control.” But her body was screaming aloud, run for hills! Run for the hills! We’re all gonna die! I have to admit, that nervous little woman scared the hell out of me. So I gathered up all the data I could find. It was alarming. According to the rate of transmission, SARS had the potential to kill every man, woman and child on the planet THREE TIMES over in a period of six months.

So I was livid at those slacker Chinese who played craps with the entire world community. And here I am, several years later reading this piece by Liu Binyan about “how a disaster was caused while officials waited for “higher instruction” instead of taking decisions during an emergency.”

And I reckon since Dr. Anderson did specifically say we should look at the RSS feeds, it’s only fitting that I should add something to my blog that complies with his suggestion.

http://www.fool.com/investing/international/2008/01/25/todays-strong-buys-international-edition.aspx

This particular article is one of those boring investment articles. Let’s face it, investment is specifically about taking the money you’ve got and turning it into more money. Now how boring is that? There were a few things that jumped out and punched me in the eye. The most obvious assault was that fact that the international stock they mention, with a whopping 63% RETURN!! I’m not a stock juggler. However, the remarkable return is significant because it underscores that China is quickly becoming a powerful economic entity in the global economy. It also forces me to consider how they achieve such a high return. I’ve already moaned about the use of forced slave labor. Stock values are calculated by return on investment. Obviously, if consumer goods are produced using free labor, the margins are going to be larger. However, there is still an undertone of instability. I can’t put my finger on it yet, but something is rotten in Denmark. I’m always suspicious of artificial economics. Right now, China is leaping forward in the global economy. But artificial economics have imploded on every artificial structure with which I am familiar throughout the entire course of human history. If I had to make a wager, I would guess that China is going to enjoy a quick burst of energy which will find equilibrium when the whole thing implodes. Artificial economics is cocaine. At first, it’s great, great, great. You feel larger-than-life invincible. But the inevitable crash is so *not* worth it. Unfortunately, there is no 12-step program. I reckon they’ll just have to white-knuckle it through the crash. No doubt, American soothsayer-carpetbaggers will be there to exploit, er, help them out of their dire crisis.

Nah. I changed my mind. Exploitation! The protein power-bar of choice for American economic body-builders worldwide. If your country is feeling exploited, there’s an American involved somewhere. Americans are gluttonous larvae. We’ll feast on any carcass until nothing but a rotted shell remains.