Tuesday, Oct 30, 2007
KERCHING! - INFLATION-TASTIC! Ignore this one at your peril Barker!!!
Telegraph: China's 20pc wages rise prompts inflation fears
Wages in China's cities have risen by almost 20 per cent since the start of the year, the government in Beijing said yesterday, adding to fears that the country's economy is overheating and might export inflation round the world.
Posted by tyrellcorporation @ 08:52 AM (920 views) Add Comment
19 Comments
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1. inbreda said...
There is absolutely no way. NO POSSIBLE WAY!!! that this cannot result in inflation in UK.
Low price chinese goods have been the excuse for low inflation, so this simply must result in higher inflation.
That means higher interest rates.
I cannot see any way out of this.
2. shipbuilder said...
And so they should get higher wages - this, after all, is how the moral side of low-cost country sourcing and production was sold - that it would bring up the standard of living of the people in those countries. Unless of course we were lied to by companies who simply wanted cheap labour?
We got our cheap goods and now we have to pay the price - how many times do we all need to be reminded that you don't get something for nothing?
3. stillthinking said...
Maybe the Chinese will even buy some stuff from us! We will probably have a lot of goods, ironically made in China, coming up on Ebay soon. Or they could buy stuff we actually make ourselves, like, like, ermm......service industry, no, ermm,... cheeses and dubbed BBC dramas.
4. stillthinking said...
How much could we get for seven series' worth of 'Only Fools and Horses'. I think it could be quite a substantial amount.
5. Orwell said...
Yes you do shipbuilder, property....
6. george monsoon said...
In the past, individual nations have had hyper inflation.
Has there ever been a time where the whole world is experiencing hyper inflation or is this not possible?
7. voiceofreason said...
Here's a nice press release where one of my bosses goes on record as saying that in the long term, he is mving our chip design work to India...
http://www.eetimes.com/news/latest/showArticle.jhtml?articleID=202602753
Nice and motivating for the 400 engineers here in Southampton.
According to economists, we will find something else to do and it is for the good of the global economy. Just liek all those miners did in the early 80s I guess.
Hmmmm ....
8. eyeoftheweasel said...
The long term result of this may well be an increase in unemployment and low paid jobs in the UK. As a result no-one in the UK can afford expensive products. China, India, etc end up buying the goods they produce themselves with their rapidly rising wages. In the end the UK (+ at least some other EU countries) and US become the new low-cost countries.
9. cyril said...
@voiceofreason - silicon chip design is not high tech enough for the knowledge economy I'm afraid. You need to go for something a bit more value added such as making coffee.
10. su said...
Stillthinking.
I'm not sure we'll be able to export cheese to China as I understand 90% of Chinese and Japanese people are lactose (milk sugar) intolerant.
11. sold 2 rent 1 said...
I can see this leading to higher prices in the shops. But we are in no position to ask for wage increases to cover the extra costs.
The end result is lower spending and recession.
12. The Reaper said...
if you insist on pegging your currency to something that's going to depreciate,you will get inflation and you will export it.
13. planning4acrash said...
Get all your cheap LCD TV's this January sales, last chance saloon!!
14. eyeoftheweasel said...
That's the new investment bubble to replace BTL sorted then. Buy up all the cheap electronic goods you can now, then sell them next year for a huge profit.
15. Wdbeast said...
2008 is the Chinese year of the Rat, we've got plenty of those to export to them!!
16. Disillusioned said...
Wdbeast - maybe there is a year of the CHAV and we can get rid of those too...
17. Crowbar said...
Where can I get the original Press Release "NXP to shift more chip development to India"?
18. drewster said...
Maybe we'll have bankers' strikes and three-day working weeks. I can just picture all those redundant stockbrokers manning the picket-lines, shouting "scab" at anyone who dares cross.
19. yorkshireman said...
A friend who has manufacturing in China spoke of the Chinese "becoming more avaricious" and that his costs were going up as a consequence. I did not think much about it at the time, but looked into it since. There seems to be little regard for Health and Safety or the environment or for the rights of the employee and pay is described as "low but sufficient" This is not the case. We, and by that I mean all of us have treated these people with a degree of contempt, expecting them to make our consumer goods and not expecting them to have any real benefit. They deserve more money and that is what they are about to get. If the consequence of that is exported, then so be it.
Unfortunately, in the UK, there is more apathy and we are happy to be taken for a ride with rising house prices in and costs in general. No chance of a revolution here though - at least until the money-go-round stops.