China produced 57% of global crude steel, turned nearly all into finished steel products that it exported or used in domestic manufacturing and construction. The annual steel report is out.
By Wolf Richter for WOLF STREET.
Global production of crude steel – ingots, semi-finished products (billets, blooms, slabs), and liquid steel for castings – ticked up just 0.5% in the year 2020, to 1,878 million metric tonnes (Mt), according to the World Steel Association’s 2021 World Steel report today. The 0.5% gain came in two slices: China boosted production and gained a chunk of market share; the rest of the world lost production and market share.
Since 1995, there have been only three periods when annual crude steel production fell: The Asian Financial Crisis in 1998 (-2.7%); the Global Financial Crisis in 2009 (-7.8%); and in 2015 (-3.0%), when China made a short-lived effort to get a grip on the money-losing overproduction at its steel makers that are supported and often controlled by various government entities:
But in 2020, China’s crude steel production, despite a large drop during its lockdown early in the year, rose 6.9%, to 1,064 Mt, accounting for 56.7% of world production. In 2017, China had outproduced the rest of the world for the first time.
In the rest of the world without China, production fell by 6.8% to 813 Mt. China has been able to grab market share during each crisis. Over the past 20 years, total crude steel production surged by 120%, and nearly all of that gain went to China:
In all of the largest producing areas, crude steel production plunged in early 2020. But China more than fully recovered a few months later and then blew by its prior production levels. The CIS (the post-Soviet grouping of countries including Russia) also recovered and late in the year outproduced their pre-Pandemic levels. But the US, India, Europe, Japan, and many other regions didn’t get anywhere near fully recovering. They all lost market share to China.
In the US, crude steel production plunged 17.2% to 72.7 Mt. In the USMCA area – the US, Mexico, and Canada – production plunged 15.7% to 100.5 Mt, the lowest in the data going back 25 years, for a share of 5.4% of global production, while China’s share surged to 56.7%. In 2001, China’s market share had for the first time surpassed NAFTA’s market share. The trend couldn’t be clearer:
Of the top five producing countries – China, India, Japan, the US, and Russia – only China increased production in 2020.
China’s production was over 10 times the production of #2, India, and about 15 times the production of #4, the US. The USMCA countries are indicated in red. Production quantities of Mexico and of Canada are hard to see without magnifying glass:
China converts most of its crude steel to finished steel products.
Most of the crude steel China produced in 2020 was converted in China’s factories into higher-value finished steel products. These finished steel products were then either used in construction or by manufacturers (to make products for export or for Chinese consumption) or were exported outright.
While China produced 56.7% of the world’s crude steel, it also produced 56.2% of the world’s finished steel products.
In terms of crude steel, China exported only 51 Mt (4.8% of its production); but it also imported 38 Mt of crude steel, for net exports (exports minus imports) of 13 Mt, just a tiny fraction of the 1,065 Mt of crude steel it produced.
The 15 largest crude steel companies in the world in 2019
Nine of the 15 companies that produced the largest quantity of crude steel in 2020 are Chinese companies, and six of them are owned or controlled by government entities in China.
Nucor, the only US steelmaker on this list, fell to 15th place, from 14th place last year, and from 12th place in 2018:
- China Baowu Steel Group: 115.3 Mt, up from 95.5 Mt in 2019 and from 67.4 Mt in 2018; includes the tonnage of Maanshan Steel and Chongqing Steel – owned by the government of China.
- ArcelorMittal: 78.5 Mt, down from 97.3 Mt in 2019. Includes shares in AM/NS India and China Oriental. Registered in Luxembourg, managed from India.
- Hesteel Group, formerly HBIS Group: 43.8 Mt down from 46.6 Mt – owned by the government of Hebei Province, China. Includes Serbia Iron & Steel d.o.o. Beograd and MAKSTIL A.D. in Macedonia
- Shagang Group China: 41.6 Mt, up from 41.1 Mt in 2019 – privately owned, China.
- Nippon Steel Corporation: 41.6 Mt, down from 51.7 Mt; includes Nippon Stainless Steel Corporation, Sanyo Special Steel, Ovako, and 40% of AM/NS India and 31% USIMINAS – Japan.
- POSCO: 40.6 Mt, down from 43.1 Mt in 2019 – South Korea.
- Anshan Iron and Steel Group, or Ansteel Group 38.2 Mt, down from 39.2 Mt in 2019 – owned by the government of China.
- Jianlong Group: 36.5 Mt up from 31.2 Mt in 2019 – privately owned, China
- Shougang Group: 34 Mt, up from 29.3 Mt in 2019 – owned by the government of Beijing, China.
- Shandong Steel: 31.1 Mt, up from 27.6 Mt in 2019 – owned by the government of Shandong province, China.
- Delong Steel Group: 28.3 Mt, up from 26.8 Mt in 2019– privately owned, China.
- Tata Steel Group: 28.1 Mt, down from 30.1 Mt in 2019 – India.
- Valin Group: 26.8 Mt, up from 24.3 Mt in 2019 – controlled by the Chinese state, with a minority stake being publicly traded.
- JFE Holdings: 24.4 Mt, down from 27.3 Mt – Japan.
- Nucor Corporation: 22.7 Mt, down from 23.1 Mt in 2019 – USA.
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The CCP controlled factories get ultra-low interest rate loans, free or ultra-low priced land or factory locations, quasi-slave labor that cannot unionize or complain about anything and is watched by the state with dystopian means, ultra-low cost, subsidized materials, freedom from regulations (particularly because the CCP does not truly care about its population’s health or the environment or pollution or carbon releases), freedom to release toxic waste (which has caused US manufacturers to either incur large, recurring expenses or huge clean up liabilities), freedom from any intellectual property rights of any foreign company, subsidies from the CCP government to sell goods below cost to drive foreign competitors out of business, and stolen foreign technology via the government-controlled PLA hacking operations. It is amazing that Americans are watching all of their jobs and factories shifted to China with so few protesting.
Do they not realize that there will be no manufacturing left in America, if the CCP so chooses, because there is no way that any US manufacturing company can compete with ultra-subsidized CCP controlled companies in a nation that is happy to exploit every merchantilistic tactic? We are going down and no one seems to actually object: all are happy about the cheap, Chinese goods that are being delivered.
I forgot to include cites: “China’s Foreign Investment Law: Not Good News”: “China’s state-led economy makes it clear for foreign firms: you’re either OK with regulatory requirements, or you’re out” in scmp.
Note that the advantages offered to foreigners investing in China before have been removed. Now, the CCP clearly intends to replace them with CCP controlled firms, which can out-compete them due to the subsidies discussed above. For example, they intend to replace Tesla with a CCP controlled firm that gets its technology, legally respecting patents or more likely, not.
Re Nucor; a US steel manufacturer. If I recall right, they are mostly into recycling steel (a good thing, to be sure).
But still shows our pathetic manufacturing share, ESPECIALLY in steel fabrication. Pretty sure a good chunk of the rebuilt Bay Bridge in SF came pre-fab from China…..and of course there is farm and construction equipment, along with cars and washing machines, few of which are made within our boundaries….maybe some are assembled here from steel parts made elsewhere…..like my Nissan was “assembled” in Kansas City, I think, but from parts made elsewhere. Probably much easier to package and ship parts than entire vehicles, so that and a few State perks like free land, etc drive this, plus decent US job PR points.
It’s pretty astonishing to think when you visit a WWII Battleship museum like the USS New Jersey…
That America couldn’t manufacture that today.
America can still manufacture lattes from Starbucks though, that should count into the PMI. Hahahahaha.
Yeah, it’s a consumable… heck, given how we have defined away inflation, or defined in things like structural r*****, why not define in something like manufacturing.
Whose going to know the difference, certainly not your reporters today.
But we are still EXCEPTIONAL INNOVATORS and entrepreneurs. Remember O-O-O-Ozempic? Well it’s got a brand new name and brand new use, now. And only $1300 for a month’s supply! Pharma and “Science” and Medicine are now a complete blend of bought off charlatans run by MBAs…right down to the family doc……but hey, the gov’t will pay for it all, so who cares about inflation? Most likely it won’t be made here if it’s a real WINNER!…..but so what, as long as someone is getting rich.
4 Billion years of trial and error evolution and we are just beating it right and left….damn we are smart!
And people wondered why I quit Pharmacy School at Oregon State after 1 year, 78-79….that’s damn good money. And it cost me a 5’10 1/2″ ex model fiancé, too. No wonder I started drinking alone for the first time…Popov Vodka..$1.49/half pint.
Sorry, but Biochem/Molecular Biology is more my area of expertise, not steel. But it’s still inventing, MANUFACTURING, and selling PRODUCT….you know, ECONOMICS.
We are so fd up.
You people would ALL do well to badmouth the folks who don’t take care of their bodies, as opposed to their finances, it’s really all you will EVER “own”.
BTW, Ozempic’s “new” use is weight loss. (Wolf chose not to print lengthy link) So, they just doubled the monthly dose, but same stuff, new name, new product. Makes ya wonder how they originally calculated that “perfect dose” to bring down A1C in type 2 diabetics with minimal side effects, eh?
Now they are pushing to get obesity classified as a disease, as in your eating/lifestyle had nothing to do with it. That way it will no longer fall in cosmetic category and gov’t (you) will pay for it ALL. Better profiteering through chemistry. Talk about ever growing slime molds…
Museums are literally the only use a battleship would have. Why would the United States WANT to manufacture obsolete warships?
If China wants to oversupply the world with cheap steel that they subsidize, I am not entirely sure why that is a problem either.
Yeah – what could wrong?
“I am not entirely sure why that is a problem either.”
it isn’t until they CUT YOU OFF
or induce fake pandemic
they are good
they would NEVER do that
Wars are unheard of in human history…
Yeah, Boeing can save more money.
“If China wants to oversupply the world with cheap steel”, I don’t think that is what they want to do. China has had a policy of dumping (their own) raw materials to keep prices low, and making it up on finished products. This is about “finished” steel products. China’s trade war with Australia was a result of higher iron ore prices. Au has half the worlds iron ore production and they can’t control that.
Merica ONLY manufactures weapons for war
our largest export market
So let me get this, I’m a bit slow.
China makes and sells cheap steel to the US, so that US can make weapons to sell to Japan and Taiwan and S Korea and all the countries around China, to resist China’s efforts to dominate the South China Sea. So China has to make more steel to build a navy to defend against all the ships built with their own steel.
Did I get that right?
@Harvey For real? That’s got to be one of the most ignorant comments I’ve seen on this forum. The loss of steel production for the US is a severe national security issue. It should be very concerning to anyone that gets it. High quality steel is the backbone of nearly everything that gets built.
Nononono, If they try anything funny we will just activate those apps that turn our smartphones into transformer fighting robots. But that will never happen, who on earth would want to destroy a country that blessed the world with such paragons as Kim Kardashian, Kaitlin Jenner and Miley Cyrus? And let’s not forget Dennis Rodman, North Korea will back us up too if it comes down to it. Don’t worry guys, everyone in the world loves what the USA does. We are the engine that drives global social progress.
im not sure if chinese steel has improved but i used to machine woodturning equipment from steel billets and whenever the supplier slipped in some chinese steel it always had blow holes and was a pita to machine.
Give it a few more years “growff” and the entire US economy *is* national security, thereafter *everything* right down to a dog shit on the pavement is a national security issue!
Then someone like Clapper can lie about shit in Congress.
Of course it could manufacture it but it would be of even less use than in WWII.
Yeah – what could be less of use than domestically producing high grade/high strength steel used in bridges, highways, structures, ports, ships, railroads, drilling, etc.
Come’on man! You ain’t an economist!
You can’t be serious.
If the steel is made cheaper overseas it makes ZERO sense to waste money manufacturing it on-shore.
Just import it from overseas, save the money, and invest the money saved in something more useful.
It’s called productivity.
My understanding is that you’re in Australia, per your IP address. All folks outside the US support the idea that the US should import every little thing to enrich those outside and fatten up their pockets, including their own. It’s the most logical thing for non-Americans to say. But hey, this is our country and these are our jobs … well, “were” our jobs. Now they’re someone else’s jobs.
Yes, why even make anything? We can just buy what we need from others using printed monies. You utter fool. There is not one flaw in that plan.
Julian, you are my new spirit animal. Algernon Bless you. Cheers.
Julian wrote: “It’s called productivity.”
What do you call it when exporters to US stop accepting payment in US dollars?
OK, so NO one likes importing steel to the US. Fine, now just tell me why this is a China story. Not China’s production, of which China is itself a huge user, China’s share of US imports. The US imports steel from 70 countries. Here they are:
‘The top 10 source countries for
U.S. steel imports represented 78
percent of the total steel import
volume in 2019 at 20.4 million
metrics tons (mmt). Canada
accounted for the largest share of
U.S. imports at 19 percent (5.0
mmt), followed by Brazil at 18
percent (4.8 mmt), Mexico at 13
percent (3.3 million metric tons),
South Korea at 9 percent (2.3
million metric tons), Japan at 4
percent (1.1 mmt), Russia at 4
percent (1.0 mmt) and Germany
at 4 percent (965 thousand mt).’
I’m all for confronting China’s expansionist
claims in the South China Sea, the CCP threats to Taiwan and lately Oz, but they are in 11 th spot in steel exports to the US.
Because China’s steel companies transship via other countries to the US.
You’re Canadian. Complain about Canadian tariffs on imports. That would make more sense.
WR: appreciate you allowing an alternate view. No doubt a 3000 mile land border offers transshipment opportunities.
Everything is a matter of degree and DC has eagerly self-lobotomized itself when it comes to domestic US manufacturing (see paper surgical masks).
1) At an absolute minimum, prudent stockpiling of goods from a potential hostile power makes sense.
2) Diversifying demand away from very heavy/sole reliance on a potential hostile power makes even more sense.
3) Retaining the minimum industrial base necessary to reconstitute industrial knowledge/capacity if necessary makes sense too.
Those may be “wasted” costs…but they are also prudent insurance.
If Covid shortages taught us nothing else, they should have taught us that.
The real world tends to be a bit more complicated that Econ 101.
Speaking of infrastructure, a main artery bridge on I-40 at Memphis is shut down, falling in. The Arkansas river there is only about 2 miles across, so few alternatives. Are we waiting on new steel from China to patch it?
I think I’ll start travelling I-20, at least I don’t know how bad the bridges probably are.
What could go wrong if you produce all of you PPE in a foreign country and then there is a pandemic? What could go wrong if produce all of your vaccines and medicine overseas and then e.g. India puts an export ban on vaccines due to domestic need (The US was less effected, but other countries very much so)? What could go wrong if you import most of your food and then e.g. Russia applies an export ban on Wheat (might also not have effected the US, but should still demonstrate the point)? What could go wrong if you heavily rely on imported energy and then OPEC issues an oil embargo?
There is more to life than “productivity” and minimizing costs, there is also such a thing as “resilience”. And relying on imports for critical needs makes you vulnerable. Even if normally you can bully your way out by being the richest country with the biggest military.
ANY US Guv mint policy that does not emphasize ALL ”needed” thingys,,, repeat ALL needed being totally sourced and fabricated/processed in ALL ways IN USA is wrong policy,, and needs to be changed immediately if not sooner…
That various politicians and their clear owners of the current oligarchy have been guilty of sacrificing the well being of WE the Peons of USA in the last 50 years or so in order to personally profit has been made very very clear in the last 16 months or so,,, but was already very very clear to many of us who have been saying so for decades.
Time and enough to bring it ALL back home NOW!!!
Can but does not want to ..
Good ol’ Aussie land too.
However .. some smarty pants is making the money .. or it wouldn’t be happening.
Someone on our side of the oceans.
That is simply not accurate. Where do you think the Navy gets it’s ships from, Amazon, Dollar General?
So you’re upset the Navy isn’t using 1940’s technology?
America doesn’t even have the 1940s technology anymore. They have no steel manufacturing capacity anymore except in specialty steels.
You seem to think that is one big joke.
“So you’re upset the Navy isn’t using 1940’s technology?”
Ford plants were building B25s one an hour near the end of the WWII….(aluminum)…
Do we have the capacity do such a thing today?
Where would Amazon, Facebook, Twitter line up in a geopolitical blow up?
Would Tesla donate its production to a war effort?
The most powerful and heavily armored battleship ever built at 80K tons, with 18 inch guns, the Japanese Yamato, set sail in 1945 on a one- way suicide mission to attack US ships off Okinawa. It never succeeded in firing a single shot at a ship, being sunk by aircraft before reaching the scene of battle. Earlier in the war, Japanese aircraft sank 2 Brit battleships. Although Yamato was a fitting swan- song to the concept of the battleship, it had long been recognized as obsolete. Billy Mitchell shocked world naval establishments when his biplanes sank captured WW1 German battleships in the 20’s, but they were military/ industrial establishments and kept pouring money into more obsolete battleships.
They could be built today, as could steam locos, or steam paddle- wheelers.
The Chinese Communist Party’s first weapon. Steel Production.
Exactly. These ignorant statements on this forum are astounding and assume China will always play nice and produce at our request. Dumb. Look how they leveraged Aussies with iron ore recently and are giving them the rag doll dance.
I would politely disagree with the assertion-The Chinese Communist Party’s first weapon. Steel Production. The Chinese Communist Party’s first weapon-Engineers, Scientists and Mathematicians. We have more bankers, lawyers and politicians at home in the US!
Yes – battleships and steam locomotives are obsolete uses of steel. The same way the microchips in a Gameboy, Commodore64 or Cube are obsolete.
But the use of steel in a modern developed economy hasn’t gone away.
And you joke away that not being able to domestically manufacture/produce steel for bridges or highways or skyscrapers. Ha ha! Steam locomotives!
So if/when an “infrastructure” bill passes – where do you think the money will go to get all that stuff? If it is even obtainable in the international political environment.
But ha ha! Steam locomotives!
It’s not that the US or many other nations don’t know how to manufacture this stuff. It’s China subsidizing these industries that make it not profitable for companies to compete. When the CCP gives land and free electricity, it makes it difficult for companies to compete against that without it.
When a bankrupt steel company shuts down, all knowledge is generally lost
Haven’t we subsidized Tesla as well?
That is interesting and something I didn’t know.
Yes the US and China both gave subsides to Tesla. The structure of the deals were very different though.
Maybe SO 2b,,,
But curious as to who owns the steel processing facility just north of Mobile, AL these days, and what use it is being put to?
It was constructed for about 4BB in the late oughts, and also had a very nice training facility paid for by the state of Alabama constructed nearby to facilitate training of workers for the steel factory?
That facility alone should be enough to make all the steel for any ship, etc., etc.
IIRC, there are also many other steel manufacturing facilities, from start to finished products in USA,,, some of which are not really that far from being capable of production IF the price is right, which somehow, SO FAR, the price is not right.
Suspect there are also tons and tons of new ”red tape” NIMBY, etc., ad infinitum constraining USA production.
And the US aircraft carriers are made of plywood.
I read a couple of years ago that Chinese steel overcapacity was greater than the total production of Europe. When there’s no environmental regulations to follow, when the employees are paid low wages compared with the rest of the world, when the industry is hugely subsidized for political reasons, when the rest of the world allows this through free trade, such a feat is the inevitable result.
If China is happy to subsidize the whole world what is the problem? Meantime you/we/anybody can invest in more productive industries.
Steel is a past.
“Steel is a past” only for ghosts. So maybe that’s what you are.
For real people in the real world, steel is everywhere, from your computer to the building you live in. You cannot commute to work without steel, and you cannot work from home without steel, and you cannot even buy a peach without steel because the entire transportation infrastructure and network depends on steel.
Recall the bay bridge had specialized stew components that they could only source from China. It is utterly laughable how China has moved up the value chain while continuing to hold its top position at the very bottom of that same chain.
Alas, we just need to believe that same executive who always says that the US can stay ahead of China just because we will always be more innovative.
Yup, that explains away companies like Huawei, Tencents, DJI, etc. none of them are innovative at all.
“Steel is a past”
That’s the same line of thought as “we don’t need natural gas”. They forget that most plastics are made from cracking natural gas. And boy, do we use a lot of plastic stuff.
Our new refrigerator appears not to have as much metal as the last one. My frig magnets only stick around the edges, more shrinkflation?
Magnets stick only to iron (Fe), they don’t stick to anything else.
There are many types of steel that don’t have iron in them, including stainless steel. So if you have stainless steel pots or knives in the kitchen, check their iron content by holding a magnet to them. There is a reason for it: Iron oxidizes in an ugly way (rust), that’s why kitchen surfaces, such as fridges, don’t have iron in them.
That said, we have some cast-iron skillets and a cast-iron griddle that are wonderful but require special care, or else they rust.
China’s steel is it’s Military backbone.
re: “There are many types of steel that don’t have iron in them, including stainless steel.”
Not true, Wolf. Stainless steel is an alloy made from iron and carbon, just like all ‘steels,’ but it has higher amounts of chromium and other elements to resist oxidation. Here’s Wikipeida’s opening:
“Stainless steel is a group of ferrous alloys that contain a minimum of approximately 11% chromium, a composition that prevents the iron from rusting.”
@Wolf This article must have brought the ignorant out of the woodwork on steel production. You are exactly right. Steel is literally in everything constructed.
Wolf, pretty sure stainless steel contains iron as main ingredient. Unless of course it is Elon Mask’s space exploration stainless steel which is mostly made of unobtainium.
I think the part that is really should be amplified in your post is the fact that it isn’t just raw steel that is being produced.
There is a ton of specialty steel where the real money get made. It isn’t just commodity steel that China is putting onto the market.
The entire thing why China is dominating is because China is not only taking on the bottom level commodity steel, they are also pulling in the value added stuff further up the supply chain. Again the bay bridge, where China manufactured specialty bolts, why, cause it was cheaper than US steel. Quality sucked, but Caltrans was so used to cheap, they didn’t care. Eventually it was all made good, the Chinese steel company got the money, and gained experience on how to do the parts correctly because Caltrans was too cheap. That enabled the same company to move up the value chain and beat out other non China steel companies later on in similar projects.
It happens all over and has been historical for 25 years as far as China’s move up the value chain. Huawei started out as a little distributor company hawking crap from Europe, and cheap telephones made locally. They worked their way up the value chain, doing fibers, sub assemblies, modules and so on. They didn’t get to their leading status by copying all the time, everyone in the telco industry knows that by the late 2000s, there was nobody else Huawei could copy from because they were the technology leader.
Wolf, stainless steel totally has iron in it. The majority of it’s composition is iron. Stainless has chromium and nickel, that well, make it stainless. I’m just a guy that welds as a hobby, so that’s the extent of my knowledge.
The academics push this stuff- and quote Adam Smith. The Smith “anti-mercantile” work has to do with trade, and specializing in your strongest product. This works extremely well when the trading partners have relatively similar economic structures: wages, regulations, etc.
If it was “always and everywhere” best to buy the lowest cost product (that is capable), there wouldn’t be any dumping laws, etc. It’s an absurd statement that even Prof. Friedman made- saying the US should just buy all the Japanese cars possible in the 1980s… There is a little problem with storage and maintenance, right? (academics don’t get that kind of mundane stuff) Buy millions of ’em and park them until you need them, right? (ridiculous)
It’s very disturbing that the academics enable this nonsense, which allows it to get into the institutions like central banking, and of course the MSM spouts it when it suits their purposes.
This kind of “similar economies” concept is one reason why there are regional trade pacts, such as NAFTA. The closer in geography, the more likely economies are to similar.
Did the trade war with China brought back any jobs? No, it just relocate to other parts if the world where costs be are lower. China isn’t the only problem, otherwise it us very easy to resolve.
You’re in Malaysia. What is it with you foreigners that get rich off US imports wanting to tell us how to deal with our economic issues???
Jobs are not cats. They don’t “come back.” That is a stupid assertion.
But I agree with you, this is not a US-China thing. This is a US-rest-of-the-world thing. Or rather a US vs. Corporate America thing. Corporate America, incentivized by US government tax policy, is the biggest culprit. Tariffs on all imports would straighten some of this out.
If you take the incentives out for Corporate America to offshore production, by making it more expensive via tariffs, then they have to do some calculus. Prices are determined in the market place. If a US producer can beat a producer in another country after tariffs, the jobs and the expertise and the infrastructure and the tax base and everything stays in the US. And that’s good for the US and not good for other countries. That’s why you hate US tariffs, and why I think they’re great.
You’ve made it, Wolf! You have attracted international trolling syndicates!
Still, there are people who really buy this, who can’t think past “stage one” as Thomas Sowell says. “Why are we wasting our money on expensive Americans in our military!? China will do it for HALF the price!”
Steel is a “past”? So your new bridges, buildings, ships, etc, will be made of cream-latte? Good luck…
the way to tell if ‘steel’ is stainless steel is to check if it is magnetic. I do this when welding. We have a new fridge as well. The only mild steel is the sides, which is encased in a spray plastic. The back has a thin galv set of panels.
Our pics are on one side which faces a hallway. If your fridge is recessed in cupboards you will be out of luck. :-)
It just means your new fridge is well made with stainless steel. However, cross your fingers a circuit board doesn’t fail as replacements are almost impossible to source.
If folks want the old fashioned stuff (which I do for washers etc) I go to Rick’s Used Appliances. Seriously. They recondition solid appliances, like washers that actually use enough water to was clothes. Good luck finding such a place as they are a dying industry in these throw it away times.
Now, if I could just find a decent ice chest instead of the modern plastic crap…….
You may want to check out the various and sundry and extensive ”grades” of SS Paulo…
Some are magnetic,,, some are not…
Some will ”rust” and some will not;; some are impervious to various and sundry other types of degradation, such as salt water,, acids, even various ”bases” and some are not…
Not really sure how many grades and types of ”stainless steel” exist today, but know far shore it is many more than 50 years ago when the choices were 18-8 or 18-10…
(BTW,,, some of the above learned the hard way when I had to have some SS parts fabbed up for my sailboat… it was only possible to do from ”304” and those parts rusted the first time they went near the salt water!)
“If China is happy to subsidize the whole world” what’s the problem?
They are in CONTROL. And they are “happy” now, what if that changes, what if they decide otherwise?
You seem to be of the “trade deficits dont matter” mantra from the Ivied Walls of academia. So “Wealth of Nations” and Adam Smith and even Milton Friedman come to mind defending the benefits of free trade.
Yet, even Adam Smith in Wealth of Nations, Book IV, Chapter two says PROTECTIONISM is warranted in situations that are a necessity for the survival of the Nation.
Steel, food, energy leap to mind.
Your globalist professors skip over this…
Correction, Book IV, Chpt V
“If any particular manufacture was necessary, indeed, for the defence of the society, it might not always be prudent to depend upon our neighbours for the supply; and if such manufacture could not otherwise be supported at home, it might not be unreasonable that all the other branches of industry should be taxed in order to support it. ”
Smith, Adam (1981). An Inquiry into the Nature and Causes of the Wealth of Nations. Indianapolis: Liberty Fund, Inc. See Paragraph IV.5.36.
Exactly historicus. Exactly. Loss of production of certain steel, energy, and certain food products are a national security threat and should be taken very seriously.
Did you know? The average IQ has dropped about 14 points since 1970 in the USA. But don’t worry because those tests are biased and illegitimate. Also the SAT is biased and illegitimate and being phased out. Did you also know that GPAs are awarded solely by the discretion of teachers? Anecdotal but relevant story… I’m kinda hot so I’ve gotten a couple A’s from female teachers before despite doing basically no work. I didn’t even have to do anything with em. Just smiles, etc. so it doesn’t seem as if there is a fear of any fear of censure for unscrupulous grading… like at all. Culture and ethics matter. Ours are trash. This is the root of the decline. Also watch Idiocracy, great film.
This for TE:
Same experience when following an elder sib who really was a “GOOD” student:
Teachers just said, since I was the sib, I MUST get the same A as my sib…
Changed schools a couple years later, and actually had to do some work…LOL
“If China is happy to subsidize the whole world what is the problem?”
Yeah! What possible harm could there be in a police state that has explicitly stated that the freedoms described in the US Constitution and the Magna Carta upon which it was based dominates the production of all strategic goods in the world? I mean, come on man!
“that the freedoms described in the US Constitution and the Magna Carta upon which it was based” are to be opposed.
That is the kind of thinking that has led us to where we are now, unable to manufacture all kinds of key ingredients for pharmaceuticals, electronics, and on and on. We got a ‘good deal’ so now we are at China’s mercy – if they get mad and decide to cut us off, well tough darts.
Sometimes the bottom line is a lot bigger deal than the bottom line.
“If China is happy to subsidize the whole world what is the problem?” Due to the same attitude we also have no domestic anti-trust enforcement anymore. What is the problem if e.g. the investors of Uber want to destroy the competitors in the taxi industry by throwing billions at Uber’s losses? What is the problem with investors to sink billions into companies to gobble up market share?
Well, once they have a monopoly and start wielding their market power, you will find out what the problem is/was! Or for that matter if the monopolist e.g. gets hit by a single ransom ware attack and that takes out a large chunk of the production. Concentration of production is always eventually going to be a problem if you actually need a product, especially if you have no control over that production.
Yeah, for an even more comforting thought, it’s the same for our prescription drugs. China is happy to churn those out, especially since the pill containers imported into the U.S. do not have to be labeled: Made in China.
My Pharmacist says he cannot tell me where the medicine is made, but most likely in China.
Very well said, concise and to the point.
The wages that Chinese steel workers get are equal to those in America, in terms of what kind of lifestyle the money buys. That is China’s huge advantage over the West. The cost of living is low and the workers are not burdened with debt, as in America. The Chinese steelworker making the equivalent of $6 US an hour can buy the same lifestyle as an American making $30 an hour. He lives an upper blue collar or lower middle class life.
That is a lie, there’s massive household debt in China. And over the past 10 years, because of things like the RE bubble, the cost of living has risen greatly for the lower class workers in China. The bulk of factory workers in China are very poor and getting poorer every year. Their standard of living peaked something like 10 years ago.
I have seen for years comments about the inevitable Chinese collapse, how they are sitting on the world’s largest debt bubble. Yet somehow they are still managing to get ahead.
I wonder who is managing their PR, we need to hire them to pump up America. ?
I think terracotta army was the top. It’s all downhill from there. How will they manage.
I worked with a handful of Chinese engineers that got their phd’s in the U.S. and took R&D positions in the U.S. They told me they got corporate job offers here close to $100k and had the option of staying, but even though positions in China paid less after adjusting for the exchange rate, the cost of living in China is so much lower that they all decided to go back to China. Also, I’ve been hearing for years that manufacturing is leaving China because the wages had risen too much. Surely that indicates they’ve experienced real income growth.
Property prices are a bit out-of-control in China – there’s no denying that.
Please cite any country in the developed/developing world where they are not.
While the middle class in the PRC likely shrank somewhat last year due to COVID distruption…again, please cite any country in the developed/developing world where it did not.
I don’t know the exact date the China RE bubble will pop, but bubbles pop that’s what they do, I’m sure you you’ll hear about it.
As for the economy, the Chinese economy had real growth until 2015. In 2015 was when it began to stagnate, in response the CCP doubled down on the RE bubble, artificial money, and pushing propeganda. Since then, assets and prices have inflated and like everywhere else, inflation have eaten away all income gains. This was more damaging in China then devolved countries though. That inflation makes their economy look bigger though, but it also makes business more expensive there. CCP greed and control is a much bigger reason more and more companies are leaving, to even manufacture there, there are imposing rules on your products and your brand more and more. If alot of companies hadn’t already setup shop there, almost no one, would be going there now.
In the same ways, most people here (on this website) would recognize that the US economy hasn’t actually grown since at least the 2008 recession (except for population growth), China hasn’t grown since about 2015. But when the bulk of the population were best off, was prior to that. For America, many people claim the average jo was best off decades ago, for China, probably about 2010.
It’s important to recognize most of the foreign students that come to america are higher performing ones from their respective countries. Several years ago, it was definitely possible that some of the upper middle class engineers (including starting ones) could afford a seemingly higher standard of living in China then in America. But because of the CCP’s terrible rule, pollution is literally off the scales in the water and air, traffic is spiraling out of control and the standard of living is dropping. Just like everywhere, inflated prices will start impacting those on the bottom first, and then over time, effect everyone higher up, more and more.
What aspects of China are resulting in a higher standard of living? In China, even the best cities are heavily polluted, you live in a small apartment, traffic is spiraling out of control, you cannot own your own house and you’re always under the watchful eye of the CCP. It’s always possible that some foreign students couldn’t imagine leaving their families behind and will make up some non family excuse.
Let’s not forget among the top CCP members, it’s very common for their families to live outside China; and capital flight from China is a thing.
China and US currently have very roughly equal Gdp.
China has very roughly 4 times the population of the USA.
This means the average American is 4 times richer than the average Chinese. This is a huge gulf in US’s favour which will not be closed any time soon, because change of population and Gdp tends to be slow over the years.
In that context China could be said to be a poor country deserving our sympathy but unfortunately due to huge income inequalities in both countries a poor American will not see it like that for a rich Chinese.
We’ve all got our own problems.
Why don’t you try it for a few years working in China, then report back.
In China, workers say ” Americans hope to get laid off so they can draw unemployment which is also subsidized at $300 to $600 per week. It’s Disneyland over the whole country.”
The Global Reset .. is there a clause that says .. we own it all & therefore we are coming to take over.
Surely we in the West are not going to take it lying down !!
There’s a price to pay for heavy manufacturing:
“The US claims China’s total energy-related emissions are twice those of the US and nearly one-third of all emissions globally. China’s annual emissions today are about double those of the US, according to UN data. And last year, China accounted for about one-third of global CO2 emissions while the US produced 13%”
As if that makes a difference in our aquarium atmosphere. All of the developed west is crowing about cleaner air while they/we buy crap made overseas. Same if not worse emissions. Too bad they quit taking our plastic recycling.
You talking of North Americas Future. :)
Supposedly China is painted into a corner as their economy relies on debt financed building infrastructure and exports. What good is it to borrow money to build something that has negative cash flow?
If someone offers to mow your lawn cheaper than the gas for your mower then you let him do it and find something better to do with your time.
Is there anyone else who’s concerned that every country got screwed in 2020 but China? Now that more and more information is coming out on the whereabouts of this virus will the public start to question what happened and what we were all put through. Think about what has just been released by several news outlets. Combine that and a modicum of common sense and one can’t help but to look at that chart and think that something’s fishy.
China, South Korea, Japan, Taiwan, Singapore, Thailand, Laos, Vietnam, Cambodia, etc all came through 2020 relatively OK. They shout down hard for a couple months, then things went back to normal, except for tourism. The West refused to do what is necessary, and are still paying the price.
Far Eastern countries have certainly outperormed the rest of the world with COVID, but you’ve got several things wrong here…
– Japan and South Korea never had shutdowns. They took other measures very early, though, which the USA and most Western democracies did not. Japan’s per capita daily cases are more or less equivalent to the USA’s right now, btw.
– Taiwan and Vietnam have been extremely successful. Neither really locked-down – but implement other effective measures. Even so, both are now wrestling with their worst surges since the start of the pandemic. In fact, Taiwan’s per capita infection rate has risen to about 50% of the USA’s current rate.
– China did lock down very aggressively. But remember that the entire country was not locked down. Rather, they succeeded in isolating the province of Wuhan.
Most Far East countries have strong federal authorities. Countries that have more decentralized government (e.g. the USA, Canada, Switzerland, Netherlands) have tended to fare *much* worse.
China had a head start because it had a heads up.
The Bob who cried Wolf,
You’re conflating a bunch of stuff. During the Financial Crisis, China gained a huge amount of market share too, as demand was sagging everywhere, and as production was plunging in other parts of the world.
The thing is Chinese factories that are government controlled or supported just keep going during a crisis, even if there is no demand, and they’re overproducing, no problem, and their biggest customers are state-controlled entities, and their lenders are state-controlled banks. They’re in an entirely different environment when there is a crisis.
It is looking more and more like 21st century Chinese communism is prevailing over the decadent capitalism we have in the US now. As our standard of living continues to decline and our society melts down (witness mass shootings and homelessness), too many of us cling to a believing in a corrupt system that is failing us.
“It is looking more and more like 21st century Chinese communism”
It’s not communism, or in name only. Now it’s a form of what Mussolini called ‘corporatism’ — which he felt was a better term than fascism. Among the super rich in China are the highest members of the CCP.
“To get rich is glorious ” Deng Xiaoping
Part of what makes that system work is the attitude that life is just another cheap commodity.
They were wearing masks long before covid because we exported pollution along with our jobs.
Chinese government is not immune to the laws of economics. Their ability to operate at a loss can’t go on forever given the political backdrop; capital flows can’t stay caged forever.
The Bob who cried Wolf,
Look, I love you, but I’m so tired of reading this nonsense, still, after 15 months. There are 1,000 theories being propagated from day one about covid. 999 of them are going to be proven pure BS. One of them might turn out to be true. For now, we don’t know which one. And on my site, you don’t get to decide which is which. So I don’t allow people to try to abuse my site to spread ANY of those theories around. That was step 1.
Step 2 is the idiotic connection you made between your theory of the origin, and that it was planned by China to harm the world. That is just braindead BS.
I tried to be nice about it in my reply to your first comment. But you quadrupled down. So I deleted your reply. Now you’re coming back for more. So I’m no longer nice about it. I would rather shut down my comment section entirely and for good than let it be abused for spreading this kind of toxic braindead garbage.
The US basically gave up global leadership under the Trump admin. China filled the void, they have a manifest destiny. From clean power tech, EVs, steel, to computer chips; all China dominated. They own the future; China middle class becoming wealthier all the time; they’re cranking out millionaires faster than anyone else.
China does have serious challenges; An unfolding demographic crisis (lifting ban on having 3 children), a quickly aging population. They can fill that void by encouraging immigration, but of course, China doesn’t exactly have a history of encouraging immigrants do they?
I can’t think of a single area where the US currently leads in a global sense….except for perhaps meme-stocks.
The demographic challenges of China are being exaggerated just a bit..
a) China is automating much of their economy
b) China is starting to tap the brakes on its push to urbanize as many people as possible. This is being done – among other reasons – to try to curtail property price increas in urban areas.
The recently-announced “3 child policy” is really related to “b”. Family farms generally benefit form having larger family size. So it’s really geared towards assisting rural areas.
You cite “immigration” as a possible means for China to cope with any demographic crisis. While you correctly believe they would be very reluctant to use such an approach – you have forgotten an alternate solution.
China’s interest in Africa extends beyond its natural resources and its use as a source of demand for China’s capital goods exports (e.g. coal plants0.
Africa is demographically very-young. So this offers them:
a) A young workforce for labor intensive opreations required by their burgeoning transnationals
b) A decisive tilt in their favor in “soft power” should the African nations take a liking to them
This stuff started long before trump got stuck with the crowd of losers in Washington.
Yep, it’s all Trump’s fault. Clinton, Bush, and Obama were all doing great and the US was on top of the world doing everything right until Trump showed up and screwing things up and gave an opening to China. Keep telling yourself that.
That’s one of the most delusional things I have ever heard, as if China was some backward mud hut country until 2016, and once Trump took over, China vaulted to become the 2nd largest economy in the world.
The only area where I can point to that was actually a strategic screwup by China (and only history will tell for sure) is when XJP started pounding his chest openly in front of the world instead of quietly and steadily building China like his predecessors did while following DXP’s roadmap.
Even that move might be brilliant if China ultimately displaces the US.
China has been eating our lunch long before Trump got elected. We lost our steel companies starting in the late 1960’s.
A lot of accidents happen in a lab. Sometimes it turns out to be good like the accidental discovery of polycarbonate. Sometimes it happens to be bad.
I live about an hour from UNC who has a research lab that has been involved in this Saga. They have had leaks there and one where a Chinese research student got booted from the country for doing a no-no.
China makes tinfoil too.
How about a monumental leap of faith, pun intended. A planned economy might be more organised and efficient than a country made up of 50 individual entities all acting in self interest. Coupled with constant electioneering and conspiracies, plus an uniformed public……..
Yes, in jail you are also more organized and efficient. Do you prefer that?
I think you mean all of North America, right?
“Is there anyone else who’s concerned that every country got screwed in 2020 but China?”
It is amazing what one can achieve if one does not try and gas light a virus! If one actually tries to follow science, and if one still has a populace who believes in sacrificing some conveniences for the greater good of society instead of shouting “freedom!!!” while causing harm to ones neighbors, family and friends. It also helps if one doesn’t have leaders who are more interested in trying to enrich them selves on the latest deal of PPE, hand sanitizer or mergers and acquisitions of hospitals to drive up prices with tax payer money, rather than to actually sit down and put in hard work to protect ones society as a whole.
BS. COVID most likely arose due to food / “traditional medicine” markets that would be illegal in most countries. As in previous pandemics. The US with its public health rules has no immunity. We are essentially like the native Americans wiped out by European germs when it comes to those pathogens. The only solution was to close borders, but hey that is“xenophobic”.
My concerns are that we screwed ourselves! The spectacle of third-rank epidemiology backwaters like Sweden believes that because nothing really bad had happened in 150 years they knew everything much better than everyone with actual, relevant and recent experience wasn’t a comforting one.
Then we have all manner of authoritarian and libertarian clowns popping up, basically insisting that no damn disease should tell them what to do.
Finally, deflection and blame shifting onto China – All incompetents at all levels prefer to lie and make up stories rather than get their own shit, that they control, in shape!
We have a leadership crisis and whatever is up with China, we still have it!!
….57% of global crude steel…
A good case for central planning. Just sayin’….
It’s not hard to make steel, China has to make alot of it in order to keep their Real Estate bubble going. There’s massive household debt because of it. There’s almost no welfare/social security programs in China, so money goes to things like subsidizing steel and transportation. While subsidizing steel and certain industries sounds very good on paper, it can lead to problems later on.
It’s also important to remember that almost no numbers out of China are real. For something like this, we would have to figure out iron ore imports to China (as reported by countries who exported them), to see if these numbers match up. For this though, It’s not that important.
Any country could start subsidizing steel production and start getting their numbers up. For China, after their RE bubble pops, we’ll probably see a dramatic decline in production.
I have been hearing that story for 10 years now. How China’s real estate bubble is going to pop. Wake me up when that happens. I have been shorting China mortgage bonds forever, just waiting for the inevitable payoff.
MCH, all financial and real estate bubbles, like those in the Untied States currently, inevitably COLLAPSE. Keep your Sino short position, it will eventually become a winner. Human nature doesn’t change, even through milleniums.
Markets can stay irrational longer than you or I can stay solvent.
And BTW, if China collapses, no one will collect anything because there will be a shooting war before that happens. And everyone will lose.
See my above comment, but no, China will probably enter recession/depression before any wars. China’s military is not particularly impressive either. The fact that China has enraged nearly all of its neighbors, doesn’t help.
As for that RE bubble, just remember that first of all, all land is leased in China and that the average income to actual prices for RE is becoming very extreme in China, it’s crazier than any devolved country.
If China enters a depression, where do you think the rest of the world will stand. Take away China today, and good parts of the world will literally grind to a screeching halt.
China is acutely aware of its own vulnerabilities. The straits of Malacca, the South China sea just being two points of vulnerability. Why do you think they are going out with Belt and Road, influence, yes, but it is to secure their own energy supply.
China is not made up of a bunch of dictator morons who doesn’t know what they are doing. Look at XJP and JB side by side, who do you think is more intellectually capable and aware. It isn’t even close.
While the US gets busy lecturing every country about pointless things and tearing itself apart so some politicians can stay in office, XJP is busy trying to shore up the foundations of China, yeah, he is there for his own power. But he isn’t actively trying to tear China to pieces.
That puts the Chinese government far above the US at least in terms of raw effectiveness.
Xi is in fact destroying China for his personal gain. Just look at how much the world’s image of China, has been destroyed since he took office. Also keep in mind the whole coold war between America and China is entirely, the CCP’s doing. The CCP has instigated the entire thing. No country in history has ever been given so many opportunities, money, acceptance into the global establishment, and more as China. Look at the thanks they gave back to the west. Look at the damage Xi has done to Hong Kong, for what benefit to China? The belt & road is going to blow back into China’s face. Angering all their neighbors, including Russia, doesn’t help secure your energy supply lines. The CCP’s actions against their native Muslim populations have also jeopardized, their BRI plans. America isn’t a one man country, It can survive JB.
As for China’s place in the global supply chain, yep it’s in there and it’s substantial, but it’s not irreplaceable by any means. 20 Years ago, China was not a major part of the supply chain and with the current direction, it won’t be in another 20 years. More and more companies are leaving, and there isn’t anything produced there, that cannot be made elsewhere. Raw materials have to be shipped to China and combined with foreign parts and often made with foreign machines to be made there. If something says “made in China” that doesn’t automatically mean the entirety of that product, was made in China, it simply means final assembly happened there. At all stores, I have definitely noticed, that over time, less and less stuff says made in China on it.
Also, today (June 4) is Tianannmen Square Memorial Day, RIP Tianannmen Square protesters.
Which is why I said elsewhere that XJP made a strategic error pounding his chest and yammering about China when he got the job.
But it doesn’t mean he isn’t aware. He is in it for himself, but his interests and China’s are aligned for the moment and he has been successful, mostly through the inability of others to counter the success of China, which mainly lies in its population.
People keep focusing on things like HK, and I would comment, how is that really any different from Minneapolis, Portland, or all those other places where rioters, excuse me… peaceful protestors run amok. Well, the difference is that in HK, law and order is eventually restored… Minneapolis, not so much. But it’s all about how the media spins things.
As for Xinjiang, if people are so against what’s happening, they can start by boycotting Products from the Chinese supply chain. Except you know, everyone loves their iPhones.
The interests of Xi and China aren’t aligned. Hong Kong is very important for many reasons, it wasn’t causing any issues for the mainland and plays many important roles in facilitating business between China and the rest of the world. It’s now increasingly dangerous for foreign businessmen to enter China and this now applies to Hong Kong. The damage from screwing up Hong Kong, will be very large for China. Xi did this to tighten his personal grip on power, against the interests of China.
The original agreement stated that China was supposed to give special treatment to Hong Kong until 2047 after that they could do whatever they wanted, between things like this, the pandemic, Xinjiiang, and much more; why should any country trust the CCP? They shouldn’t.
Also, the primary production of the iPhone and other apple products are moving to India and possibly other countries. Only some small parts and assembly currently happen in China for Apple products.
Have you ever tried making steel? It’s a mature industry in many ways but that doesn’t mean it’s easy.
Insanely huge infrastructure projects, insane volumes of iron ore and coal, huge investments in education etc. Just because the process is known doesn’t mean it’s easy or can be constructed in any reasonable time frame in the western world. Think just the environmental prestudies would take multiple years if we want to build a new plant anywhere in USA or Europe.
What I find most fascinating with producting 57% of world steel output is that it implies that China alone is producing about the same of the whole world’s stuff counted in volume/number of finished products.
The China production share counted in value is about 29% according to WEF. So maybe about 50% of any selected industry when counted in number of finished goods is a reasonable estimate. This would mean that China is about as industrially dominant as USA was around 1950 when the rest of the developed world was bombed to smithereens in WW2, Korea war, China civil war etc. With the exception of semiconductors, extremely advanced machinery, and parts of pharmaceuticals where China is still dependent of the rest of the world (Taiwan, South Korea and Japan for semiconductors, Europe/Japan for machinery).
China is the only country that knows next year’s GDP number.
MG, yeah, it is hard to get excited about most statistics coming out of Communist China. They are unquestionably WORSE than the garbage data (C.P.I.!) coming out of Washington. It is almost an unstated tenent of modern out-of-control governments to keep the peasants in the dark and feed them Doo-Doo like mushrooms are cultivated.
Our iOS and Android almost dominate 100% of the world’s mobile operating system market share. So an even better case for central planning? LOL!
The production figures are clearly impressive. Well done to Chinese for stealing the march on the rest of the world.
However, their quality control seems to be quite patchy. In my industry (structures), we keep coming across hotch-potch chemical mixes of their steel, with unpredictable characteristics and with fake materials certificates to boot.
Stan, I would not get vaccinated with a Sino Covid Vaccine either. QA should be a giant concern for critical materials and components coming out of China. In many cases, it is still Volume over Quality.
Silly, silly old woman me ..
My daughter is at home .. lockdown again ..
“I am getting depressed, I stayed in bed all day today”
Andrew is coping .. he is a boss man .. he took me home from hospital one afternoon negotiation a $6 million deal for fibreoptic cable with a stock brokerage along the way.
What If all those buildings gathering dust down town are not really empty.
What if not many persons are really working from home.
What if they are real & full to the brim companies listed on the stock exchange doing daily business .. their staff registered with the tax department .. except that they are all invisible .. not of human flesh.
It was one of the comments in the last article about the criminal corporate element.
They are $2 corporations pretending & making a killing at the expense of the nation.
What if.. It will never come back . North America has lost its Drive and is so screwed up by politics and special interest groups that can not survive. Putting Band aids does not solve the the festering Mold.
A lot of this steel goes into the the real estate bubble. Apparently, more 2nd and 3rd homes are now being sold than 1st homes. A lot of residential and commercial real estate sits empty.
My Chinese ex girlfriend bought a flat in Shanghai in 2004 for RMB 560,000. She can now sell that for RMB 4,500,000. She said it is an old, not very desirable building. These units can be rented for 6,000 per month, so basically a rental yield of 1.6%, while a five year mortgage is about 4.65% (requires about 30% down payment for 1st home).
I haven’t verified the numbers but this is what she told me. It sounds crazy to me!
Median monthly wage (2021) in China is RMB 31,100. About 25% of the population earns less than RMB 17,300.
In theory central banking and fiat currency ought to work as it allows you to fund things and get multiplier affects.
I think in reality central banking does not work because true long term wealth creation is a very difficult process that can’t be over managed. It is just too easy to eat dessert everyday until one day you realize you are just a big fat slob totally unhealthy.
Central banking and fiat currency” . . . allows you to fund things . . . ”
Endless war comes to mind.
Central banking does work… for bankers. Central banking does not work for the masses, because it is inflationary by nature, and erodes the earnings of the consumer as well as their ability to save and invest.
A good deal for one person, is usually a poor deal for the other….
50 million vacant apartments in China…. not enough can afford the rent.
1) Between the 90’s and 2005 USD/CNY was “pegged” to 8.27. China
built their mega cities, mega factories, mega army… printing
money, piling debt.
2) After a sharp drop between 2008 and 2010 USD/CNY “peg” was 6.82.
3) In 2008 USD reached a bottom, a nadir @70, along with commodities plunge.
The financial crisis of 2008/09 was “mana” from haven, an opportunity China couldn’t miss.
4) China was building mega China, using steel, copper, coal…. piling more debt.
5) USD/CNY downtrend was so strong it cont until 2014. Between 2012 and 2014 China steel production dropped, because the RMB
was too strong. There was some tremors in China and the Shanghai
stock market (SSEC) dropped.
6) In 2014, China opened their gates to wall street and US dollar moved in.
7) Since 2014 the “want” of USD to build everything in China with foreign currencies was so strong, because the world was infatuated with China.
8) SSEC : a second bubble and a plunge, between 2015 and 2016.
9) In 2020 US rode on Peloton at home and China built the strongest navy in the world.
in 2008 the Beijing Olympics was the biggest
show on earth. In 2019 Xi commanding China military parade was the biggest show on earth. In 2020 Portland was the biggest show on earth.
It seems like in 2016 the USA realized all of it hopes about China were not going to come to pass and we had better wake up and realize China had a long term plan.
A lot of China first people were infiltrating government, business and universities. Technology theft had gotten out of hand.
The trend line had to be broken.
USA is so divided that our policies ricochet from extreme to extreme, but the long term trend is more decisions made in DC. United States is a little bit of a misnomer.
“In 2020 Portland was the biggest show on earth”.
Apparatchik governance is key to PDX’s s#itshow continuance.
No surprise most of eastern OR seeks to become part of ID.
I assume there’s no comeback for the British steels either. Making other Plans for Nigel. Unless young Nigel is Chinese.
So is China using it’s own metallurgic coal or are they importing?
If so, what is the profit margin?
They are putting out the coal but are they making any money?
They use a lot of Oz coal. This trade is so vital to both it has so far survived their spat.
A couple ways to run a country…strategically and opportunistically. Strategically means defining those technologies and industries that will be quintessential to the future, and building an entire infrastructure, including an education system, to be the global leader in those technologies and Industries. Opportunistically means how to make the maximum amount of profits in today’s world. Sure, there could and perhaps should be a blend of both, but which of the two does it appear the U.S. has been focused on?
We don’t need no silly profits. We print profits. For free.
I intentionally try to buy American-made items. This is getting increasingly difficult, if not impossible. Some things are simply not made here.
Here’s an attempt to play off of my ‘buy American’ sentiment. I bought some fencing nails recently, that had the American flag and all that on the label. Then I looked closely it read “Made in the USA. Metal melted in the USA.” Yup, undoubtedly Chinese metal.
Been a tradesman for 45 years. Used to operate Makita power tools, thn Hitachi, switched to Dewalt some time ago and was planning to do my last retool with Milwaukee cordless for about 2X the cost of Dewalt. I really like my DeWalt Compound miter saw but Milwaukee cordless are outstanding.
quick search: (used to be US made)
DeWalt is a global manufacturer of power tools, hand tools, and accessories. They manufacture their tools in the following countries: United States, Mexico, Brazil, China, Italy, United Kingdom, and the Czech Republic.
Only some of Milwaukee’s products are made in the USA. According to their website, they also have manufacturing facilities in China and Europe. … However, their most popular products are made overseas for now. Most models of their cordless power drills and circular saw are made in China.
Now, I don’t even care. If the product is good I’ll buy it. If they degrade over time, which they often do, I’ll switch to another. We still call circular saws ‘skillsaws’, for any brand. Skill produces crap these days, garbage on par with Powerfist etc.
What impresses me as with their high cost of living the Germans still make their own power tools ( yes they make the cheap ones like Bosch in Mexico and such)but the good stuff is still made at home. I have mostly Fein, Festool and Metabo in my shop. My friends who are tradesman scoff at me for buying overpriced tools, but then they borrow my Metabo Drill with built in auto-reverse tapping and super precision screw clutch. At least 4 of them have returned it and special ordered their own immediately.
Wages might be higher in Germany – but the “total-loaded blended rate” (the “total cost of an applied hour of labor”) is actually a bit lower than in the USA.
Reasons include: no need for companies to fund healthcare benefits, government spends a lot of the money required for worker training, less money required for the legal sector, and lower overall land costs
It’s also worth noting that wages remain considerably lower in the industrialized east (e.g. Saxony) than in the remainder of the country.
Everything I buy these days seems to say the same thing: made in China in strict accordance with USA designs and specifications.
As if Chinese engineers couldn’t design a portable generator or a dishwasher with good specs if they so desired.
The US companies might as well describe themselves as post-production quality control.
The official term for this that has been around for many years, starting with the semiconductor industry, is “fabless manufacturing.”
The economy is great. The job report was great. WTI up @$70, but bond
traders didn’t join the party : US10Y is down 3%.
Methinks the labor market scarring we spent trillions to avoid and inflate away might be real. Seems to me that there’s a strong sense of apathy among both young and old workers about taking another jog on the hamster wheel, be it for 5 years to finish out a career or for 30 years of chronically underpaid employment.
M.E., with 16 Million Americans receiving Unemployment Benefits, how can the U.S. economy be labeled as GREAT. It is heavily being supported, only for now, by monetary control from the Fed and freebies from Washington. Bond vigilantes back in town with CPI printing at 4.2% annualized, and that is only the tip of a very fudged iceberg. Yields go down as investors flee equities with their shirts for now. You buy the dip in yields, pops in bond prices. Wouldn’t touch a negative real-rate yielding U.S. debt instrument with a 20-foot pole. Debt Defaults come in many flavors. Currency devaluation just one vanilla flavored one.
The Mesabi Iron Range mines in Minnesota that supplied the U.S. during WWII are depleted. Australia and Brazil are major iron ore exporters.
April 2021 U.S. steel production was up over 40% compared to April 2020 steel production. A rapid rise in global steel prices is causing an expansion in U.S. steel production.
As vaccine production increases, global productivity should increase.
US Steel production is up 40% but there’s a catch…
Steelmakers will be extremely reluctant to add additional capacity for two reasons:
Reason #1: The obvious is that adding capacity would lower prices and the industry has never been more profitable.
Reason #2 is far more problematic; and there may be no near-term solutions for it…
Reason #2 is that one of the largest sources of steel demand is automotive demand which is being sharply-curtailed by the chip shortage. That shortage could take years to address and – could become breathtakingly-acute should the historic drought in Taiwan necessitate shutdown of that country’s wafer fabs. It doesn’t get much press, but semiconductor production is an extremely water-intensive operation.
Steel is also used in concrete rebar, railroads, food cans, heavy equipment and tools.
Iron ore prices have nearly doubled in a year.
Coking coal is being depleted. England was once a large scale producer of coal. Their coal deposits are nearly exhausted.
US should offer Putin twelve donuts to join the party with : Japan, Oz,
India, Taiwan… to sandwich China !!
Nixon round trip.
China’s command economy allows them to add supply during economic slowdowns, and emerge from the pullback with plenty of product while everyone else is trying to ramp up production. Things are changing in China, slowing credit growth, but perhaps it is just their way of tapping the brakes while they work off excess supply. Still the Belt and Road is going to need a lot of old industrial infrastructure. They probably see all the central Asian nations along the way as smaller versions of themselves. If there is a deep global slowdown China will collapse, so they keep pushing output. Now we see the first hint they are backing off.
I have been purchasing steel wholesale on a weekly basis since 1987. I have seen crazy price swings before but never the shortages we are seeing now. We have to send our customers parts cobbled together from different sources with varying surface finishes and thickness’s in the same order. I have never ever had to do that in all my years of metal manufacturing.
Yep, standard flat stock is 10-12 weeks…crazy
For the moment, at least, China is dealing with an internal shortage of steel.
They had hoped to implement production curbs – but they are now having to cope with shortages – so I would expect those to be relaxed. Even so, I would not expect a surge of Chinese steel exports quite yet…there just ins’t any overcapacity.
Adding to this is China’s trade war with Australia. The latter is a major source of iron ore. As long as China pursues this path, they need to source their iron ore from other countries. For now, this limits the amount of iron ore available to them – and suggests that increases in capacity are limited. At least for now.
Wasn’t there once a country called Great Britain, and didn’t she make mighty ships and steam engines?? Great guns and machinery – steel beams and girders; rails and tools – made with steel?
Where is she on that list? Is there a still a British people or have they vanished from the earth?
Ruled the waves not so long ago, or so I was led to believe.
Nope, it died about 76 years ago. It’s just a husk now. Brown and rotting. Quite sad indeed.
And how did the Brits get there after ruling the world for 400 years. It was mostly because they self destructed, oh, they had help from the outside, but they got complacent, kept fighting pointless wars, and the US ate their lunch.
Replace Brits with US, and US with China, does that sound familiar?
Not really, unless china goes to war with Germany too. Not really the same thing. Complacency is on point though. And the wars are propping us up. High oil prices would have hastened our demise even faster. Cultural rot will be cited as the most prevalent cause when the 2060 Chinese historians write of how the usa became a husk. That and dysgenics, the two feed each other after all.
History is very similar in its patterns. We’re living in the era now where a new power is rising, and the old one is fading, there is recognition, and the old power is desperately trying to hang on.
Wars actually do nothing to prop us up. Before people assumed the US military was invincible (see Gulf war I), after, thank Bush Jr, people sees the US military as a joke. I think cultural rot hasn’t much to do with the US demise, it’s the fact that the population became fat, dumb, and happy, and didn’t bother to take its own education seriously anymore.
“I think cultural rot hasn’t much to do with the US demise, it’s the fact that the population became fat, dumb, and happy, and didn’t bother to take its own education seriously anymore.”
Bro, that IS EXACTLY what cultural rot is. and dysgenics… Both, but especially the latter will get you fired if you try to address them in public, and that is why the USA is doomed. Can’t even talk about it’s own diseases… much less cure them. It is forbidden.
Can’t blame China for this. It’s entirely our own fault. We decided to commit suicide, bequeathed everything to China, and China was happy to inherit the estate.
1) US Steel (X) and Carpenter (CRS) are adding capacity, modernazing.
2) US DOD and many other companies use only high end, military spec steel.
3) US navy build mini aircraft carriers, “assault ships”, with a dozen F-35B and Ospreys, at high rate.
4) Amazon suck the air from low end tech jobs market, recruiting non college employees, to move packages from point A to point B, depleting potential workers in the steel industry and other industries.
Comment moderation : AMZN ==> DC Wapo + China.
If I were China… I would send a few million smart kids over to the USA and have them apply to top colleges, get jobs at NORAD and various other strategic entities… then end global warming. I’m predicting a hard push for a nobel prize from the celestial empire. Calling it now, 2035, it’s happening. The Earth is saved. Praise Odin. Also Moloch.
If I were China, I would send a few million soldiers masquerading as workmen and labourers to a far away place offering good prospects of forever lebensraum, ammmmm, mmmm, uhmmm, ah, got it, Africa.
While the other team of dumbos is trying to steal the natural resources off a bunch of nuclear armed russki hotheads.
Not totally dumb them chinois.
China will own Africa. No colonial-era guilt…strictly business. And there are plenty of leaders in African nations that can understand and work with the CCP. You only have to insure the prosperity of the few elites in control.
Or you could help finance your smartest students studying in the finest American for-profit education establishments so one gains the latest knowledge, takes up space and jack up the costs for the American students. Those Chinese graduates, they go back home to a splendid career rather than working in America.
5) US “assault ships” are small cities, covered with “draperies”
coming out of the deck, to protect from anti ship missiles attack.
I’ve got this figured out. China is into steel – the US is into steal…
Plundering isn’t theft. It’s just paying the Iron Price. Same price we paid to get to the moon. Moonlings would be speaking German right now if not for us, is that really what you want?
I didn’t think so.
After Nelson HMS Victory, GB ruled the waves. In the battle of Jutland
GB lost their Dread-Not. Politicians kept the empire alive. Overextended and exhausted, within 1,000 days, after 1945, the British Empire was gone.
The high quality Iron Ore deposits in the U.S.( like used to be in the Mesabi range) and europe have mostly been depleted ( there are lower quality deposits though). Some of the best reserves of high quality iron ore in the world are in North Korea. They have remained mostly undeveloped due to their isolation for the last 70 years. Puts some new spin on geopolitics.
Thanks for your informational analysis Wolf! As much as we dislike the fact the steel production has been more and more in China’s control, which could pose business as well as national security risks to the US, we may have to accept the fact our country will be facing more competitions and challenges down the road. A multi-polar world and competitive coexistence are just a bitter reality. I work in a high tech company in silicone valley. I have been very much impressed with the caliber of engineers/managers from China, India and other countries in mathematics, technology and engineering etc. You see them more and more as directors, VPs, CEOs, startup founders and enterprise owners. For every smart Chinese/Indian engineer/scientist we have here in the US, there can be 5-8 equivalent in China or India. Their advantage of unmatchable man power, coupled with their pride in their thousands of years of history and culture, and resolution to modernize their countries with technology and engineering, will not only utterly transform their countries but also shift the power paradigm in the world. If we were concerned now, we should be more worried about how to keep our children and grand children’s more competitive in the not far distant future.
Pride is a sin. I’m glad we have abandoned it. Along with the patriarchy and the biased and oppressively antiquated SAT. Let those unenlightened fools keep their pride. We are flush in the only skills that matters in 2021. Twerking ability and social media follower acquisition. Many of those followers are Indians. What does that tell you? We have a bright future ahead, that’s what. Check out my onlyfans, twitter, tiktok and instagram accounts. I’m making plenty of money working these buns. And children cause global warming, we don’t need manpower, it is bad for gaia.
We are destined to be like England. A nation that looks back on the things it used to produce before it became worthless and weak…..
Winding me up huh!
I was going to post, but I’ll make it a reply instead.
I was about to say, as always, the UK was a world leader in steel until we started squabbling with the Germans over it, now we don’t even get a mention on the charts.
Steel is a toughy, Theoretically, it shouldn’t travel well, because it’s both bulky and heavy, so to ship it halfway round the world and still undercut efficient home producers means there’s got to be something fishy going on. Trouble is it’s very hard to resist a cheap gift from another country, but this is dangerous with steel because it’s a strategic material.
There is a plausible solution which clever politicians, if we had them, could implement.
If all public sector steel was mandated to be purchased from home producers at their best price that would give us all a sustainable strategic steel industry, while still allowing our private sectors to be competitive by taking advantage of China’s bargain deal. China couldn’t complain because we would be doing no more than they are.
As to “worthless and weak”, you’ll get there sooner than you think on your current course.
Yes, but the lab was financed by American tax dollars… so we got that going for us…..