ClemsSC7Skinfan Posted May 13, 2008 Share Posted May 13, 2008 I was just thinking about something the past few days. My company actually got to witness something similar which is why it popped into my head. I was thinking, I wonder if the government is allowing prices to go out of control thus allowing the american dollar to go in the tank in order to have big business come back to the US and build new plants, etc. because of "cheap" labor. If you think about it, this could be in a way similar to how the cold war was in terms of a battle against a country without every firing a shot. Anotherwords it popped into my head for several reasons, 1 being that a lot of plants moved when NAFTA was enacted but in the process the quality went down but the price was very cheap. 2 It would be a way to combat China's economy if we could lure more companies to come back to the US to build an manufacture their products. Basically the average US person has not given up anything in terms of their standard of living, yes we have all become much more concious about our spending I'm sure but overall the only people that will suffer is the banks because the government will need to bail them out when many people file ch. 11. thus it will again lower the value of the dollar. So from another country's standpoint they could build a plant in the US and it would be half the price of paying people to work for Euro's etc. If the dollar tanks and stays low you will see businesses come back here and build build build because our quality is better than Mexico's or China's and we would thus be back on a more level playing field of being cheap with those countries.Then the cycle that we have already seen happen after WWII would repeat and eventually need to tank again in the long run to repeat again. Anyhow, just a random thought, the reason it struck me was we are doing work for a Sweedish Owned company in their US plant and we told them the hourly charge and we actually went up on our price a little bit because we've actually been cheaper than most around and the guy never blinked or hesitated for a second even before we told him what we mark the material up to. So that is just food for thought. Let me know what anyone else may think. Link to comment Share on other sites More sharing options...
Kosher Ham Posted May 13, 2008 Share Posted May 13, 2008 I doubt it is intentional. Where does the Swedish company sell most of their product ? EDIT: And you should break your post up a little bit. Link to comment Share on other sites More sharing options...
ClemsSC7Skinfan Posted May 13, 2008 Author Share Posted May 13, 2008 They sell Carbide Tips, I'm guessing this plant sells most of its products here in the US. I don't know for sure. Link to comment Share on other sites More sharing options...
PeterMP Posted May 13, 2008 Share Posted May 13, 2008 China's currency is currently tied to the dollar so every bit the dollar falls so does the Chinese currency. Link to comment Share on other sites More sharing options...
the burgundy and gold Posted May 13, 2008 Share Posted May 13, 2008 EDIT: And you should break your post up a little bit. agreed. Link to comment Share on other sites More sharing options...
Kosher Ham Posted May 13, 2008 Share Posted May 13, 2008 They sell Carbide Tips, I'm guessing this plant sells most of its products here in the US. I don't know for sure. So to manufacture here is more profitable than in Sweden, and they don't have to pay the import tax, transportation, etc. On top of it all they are providing jobs for Americans and building their brand by doing so (Think Toyota). Link to comment Share on other sites More sharing options...
ClemsSC7Skinfan Posted May 13, 2008 Author Share Posted May 13, 2008 Well yeah that is my point and it is better in a longer run for our economy because it provides the lower class with the jobs that they had previously lost in the past 10 years or more. Then the money they make can be put back into the economy that we as a country would be losing if the plant was in a different country. Link to comment Share on other sites More sharing options...
Fergasun Posted May 13, 2008 Share Posted May 13, 2008 China is most likely going to de-peg from the dollar after the Olympics... right now they are playing nice with us, but I don't trust them. Furthermore... in hindsight it now looks like a silly thing to outsource to the cheapest country. Just look at the Cisco router nightmare! Cisco can't even tell which routers are "counterfeit" or not... don't you think this is happening in other industries? I read a funny quote regarding China... during the Cold War the Russian's would **** anywhere without thinking, but the Chinese are completely the opposite and won't **** until they have figured out how they can steal a toilet and some toilet paper to **** on. Link to comment Share on other sites More sharing options...
Fergasun Posted May 13, 2008 Share Posted May 13, 2008 Oh, and in this situation expect our interest rates to go through the roof, and don't expect the middle class to do much better than they are doing now. The bank's actually *won't* be hurt because they will get a bail-out, but only the pain will trickle down to every-day people. Also, some companies outsourcing strategy was "China plus one"... ie. they built a plant in China, but also a back-up plant in Vietnam or India. American's have been living beyond their means for quite awhile due to the access to easy credit, if there is any adjustment it will be a further adjustement down-ward... Hate to be so doomygloomy... but I think other countries will have us by the balls... Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.