It's a culture of exploitation, entitlement, and delusion to assume that someone else will do the exact same things we used to do, but for 1/10th the wage...
Prior to Globalization, what separated the developed world from the "Third World", was a mentality of exploitation. I mean business "opportunity". Globalization was supposed to bring the Third World up to developed world living standards, instead it's collapsing the developed world down to Third World standards. Only the exact opposite result of what we were sold by greedy psychopaths, all so they could monetize poverty at 0%.
China was the superstar of Globalization, so its collapse in broad daylight should have been the wake up call that "this" was all ending sooner rather than later. After all, China is the marginal buyer of everything. Unfortunately, self-absorbed zombies stewing in junk food and junk culture won't be awakened from their stoned coma, until the "Madoff Moment"...
"The End of Poverty". Remember that? I do.
Bono and Professor Jeffrey Sachs extolling the virtues of Globalization circa 2005. Then all of that fantasy bullshit, which was purely a function of cheap debt ironically funded by poverty, collapsed with extreme dislocation. "Oh well, off to another adventure". Post-2008, per the textbook, China initiated the largest fiscal ("Keynesian") stimulus program in human history. Their New Deal. For their part, beleagured developed nations ran MASSIVE deficits just to maintain status quo, whereas China stimulated the entire world in 2009. Construction, commodities, technology, finance. I think we all see where I'm going with this...
China's FX Reserves red with oil:
Junk bonds with China's Reserves
aka. Subprime x 3:
"The high-yield market has doubled in size, to nearly $2 trillion, just since the 2008 financial crisis. The growth is fueled in part by the results of that crisis, such as the prolonged period of extremely low interest rates. When deposit accounts yield nearly nothing, investors are driven to consider the significantly higher yields available from these bonds, despite the higher risk."
Global Dow
Like a ballistic missile launching, then coasting at altitude, and now falling, China's economy was "launched" by that fiscal stimulus, but there was no follow-through. The fantasy that China would create a middle class, was unfortunately monetized by multinational corporations.
Now China devalues their currency continuously to catch down to Vietnam, Philippines, Malaysia, Thailand etc. who've become the lowest cost producers. China is no longer competitive, as evidenced by a staggering -25% collapse in exports last month.
In other words, a minimum wage of eighty cents is no longer competitive. Corporations demand lower.
Now, go back to last August 11th last year. China finally buckled under the pressure of their dwindling reserves (above) and exports, and they devalued the currency. What happened the next day? No sooner had they devalued to alleviate pressures on exports, than their "suppliers" aka. Walmart and company demanded all of the cost reduction flow to them.
"The currencies of all our big trading partners other than China have become substantially cheaper and if they continue to become more attractive businesses will start changing their buying patterns," [Vietnam, Philippines, Malaysia etc."]
In other words, Financial bankruptcy begins with moral bankruptcy.
Indeed.
