The national debt explained like a road trip

[HK in AK]

Interesting............at the current speed we are ready to crash.....


http://www.youtube.com/watch?feature=player_embedded&v=v5fL469k9qc

[Abolith]

not just crash, when we hit the wall the damn debt car is going to explode into about 5 million little pieces O_o

[joool]

http://en.wikipedia.org/wiki/Inflation
You have to adjust numbers by inflation rate to get real numbers. btw 1000USD in 1913 = cca 21 - 22 000 USD in 2011.

[IconOfEvi]

The US is now a Pinto

[L-107]

Well with the US pulling out of most major conflict zones around 2014 the debt increase should slow down.


Also since wages in China are rising fast it will be economically good for the industries to move back to the US and Europe. Hopefully by that time the EU economy will be n better shape then it is now.



Anyhow if the 174mph is true then.....i just want someone to slam the brakes to the whole planet and let me get off cuz its gonna be a big booom.

[memfisa]

Well with the US pulling out of most major conflict zones around 2014 the debt increase should slow down.


Also since wages in China are rising fast it will be economically good for the industries to move back to the US and Europe. Hopefully by that time the EU economy will be n better shape then it is now.



Anyhow if the 174mph is true then.....i just want someone to slam the brakes to the whole planet and let me get off cuz its gonna be a big booom.

Sorry to break it to you bud, but theres a couple more countries than China, USA, and EU.

Deliciously cheap labour is, not limited to China

[seasch]

Interesting............at the current speed we are ready to crash.....

or travel to Mars ;)

[L-107]

Sorry to break it to you bud, but theres a couple more countries than China, USA, and EU.

Deliciously cheap labour is, not limited to China


No there are not here cant be. There are ways of adressing the said problem...!

Just kidding. But you are correct.


However since wages and standard of lives are improving on a planetary level how much time before there is no "cheaper" place to make things ? What then ?


If what ive read till now is an indication then either the planet goes kaboom and things star over or the sistem changes in a radical way.

However i suspect war will be the more profitable and plausible situation. So only a matter of time before the nukes start to fly.

Think im crazy ? Take a closer look at history and prove me wrong.

[Macs.]

Well with the US pulling out of most major conflict zones around 2014 the debt increase should slow down.


Also since wages in China are rising fast it will be economically good for the industries to move back to the US and Europe. Hopefully by that time the EU economy will be n better shape then it is now.


Industries have already moved back in huge numbers, atleast in Germany.

For alot of industries the human cost factor is so small that it simply doesn't matter if Wu Ling for 250 Euros per month or Hans Lang for 2500 Euros per month is pressing the buttons. However for some time (and maybe it still is in some sectors) it was much easier to finance a machine/factory in China than in Europe or the US. In alot of cases the machines are standing in China simply because the money is/was flowing much easier and not because labor costs are higher in the west.

Ofcourse there are still sectors that need alot of handwork, but those jobs should not be the ones strong economies are focusing on.

[L-107]

I know that the price of the workers is not the only factor.


However moving factories from one place to another leaves people without work and pay. that in turn generates more unemployment and even less pay.


Ideally the unemployed would find another job however since the number of jobs available is decreasing more and more people have more time between jobs and so on.


It's a vicious circle.

[HK in AK]

http://en.wikipedia.org/wiki/Inflation
You have to adjust numbers by inflation rate to get real numbers. btw 1000USD in 1913 = cca 21 - 22 000 USD in 2011.

Did you miss the part of the video where they mention the spending rate was adjusted for inflation?

[toad]

This may be a bit off topic....but it could relate to the debt or the deficit. How big it is.

Sometimes, personally, I don't think my friends even understand the scope of a trillion dollars. How big it really is. I've tried to give them this comparison I read online. fwiw


"A recent poll asked Americans how many million are in a trillion. Twenty-one percent of respondents got the answer right — it’s a million million.
Most people thought it was a lot less.
The pollster told me he tries to explain it by asking people to think of a dollar as a second — one dollar, one brief tick of your watch. A million seconds, the pollster explained, equals eleven days. A billion seconds equals 31 years. And a trillion seconds equals 310 centuries."

[seasch]

Deliciously cheap labour is, not limited to China

It is not only cheap labour, which makes companies move production to China (or the far east). A bigger argument is a higher demand for goods. Having one billion potential buyers in China alone compared to about half of that number in Europe and even less in northern America. Plus the fact that the level of saturation of goods is high in Europe and USA.

[tea drinker]

It is not only cheap labour, which makes companies move production to China (or the far east). A bigger argument is a higher demand for goods. Having one billion potential buyers in China alone compared to about half of that number in Europe and even less in northern America. Plus the fact that the level of saturation of goods is high in Europe and USA.
Also chinese wanted manufacturing placed there as a sort of "offset" for selling into their market. Understandable, but also a fine balancing act is required in terms of long term profit, long term sales, lost tech etc.

[seasch]

Also chinese wanted manufacturing placed there as a sort of "offset" for selling into their market. Understandable, but also a fine balancing act is required in terms of long term profit, long term sales, lost tech etc.

With the rise in oil-prices and therefore transportation cost, manufacturing where you can sell your stuff makes more sence too.

[joool]

Did you miss the part of the video where they mention the spending rate was adjusted for inflation?

:oops: sorry, my bad.

[poolboy]

when is this car gona crash and will obama still be the driver?

[KoTeMoRe]

Industries have already moved back in huge numbers, atleast in Germany.

For alot of industries the human cost factor is so small that it simply doesn't matter if Wu Ling for 250 Euros per month or Hans Lang for 2500 Euros per month is pressing the buttons. However for some time (and maybe it still is in some sectors) it was much easier to finance a machine/factory in China than in Europe or the US. In alot of cases the machines are standing in China simply because the money is/was flowing much easier and not because labor costs are higher in the west.

Ofcourse there are still sectors that need alot of handwork, but those jobs should not be the ones strong economies are focusing on.

Unless it is short term consumer goods. The issue is that those labor intensive sectors are also the ones that provide mass employment (outside cartelized sectors like automakers and IT). The only thing that remains is the *non-productive* service sector. Which in return gets far more compact and homogenous at home and very erratic over there.

The other issue is also the government backup all these sectors over there get. Settling up in Viet Nam for Polyprop goods will allow you a demi-god status in the region from the local and central Government. You can produce phony numbers with a downplayed benefit and then have your money flow freely to some fiscal paradise.