Friday, December 26, 2008

China, with conservative, "Confucian" economic strength, may recover much more quickly than The West

The New York Times on Friday Dec. 26, 2008 has some articles that show how important China has become economically and how much leverage it may have soon on the whole U.S. economy. The front page story by Mark Lander is “The Reckoning: Dollar Shift: Chinese Pockets Filled as Americans Emptied Theirs.” The online version of the article title reads “Chinese Savings Helped Inflate American Bubble”, link here. That makes us think that the “bailout” U.S. solution of printing money right now may not work if China calls in its investment in us some day. We seem to have depended on their cheap labor far too long.

The Business Section has a story by Keith Bradshear, “A Banking Upgrade in China: Qualifying Tests for Financial Workers.” And Jimmy Wang has a story “Chinese recruiters look abroad for diversity and expertise.” China does have strict qualifying tests for financial planners and advisers, and seems to have managed its mortgage business relatively conservatively (with high down payments for homes), compared not only to the United States but also to Britain and much of Western Europe. Again, this may make recovery in the West harder and give China a lot of political leverage.

Some laid off financial workers from firms in the U.S. with bilingual (Chinese) skills are already finding employment in Chinese financial institutions.

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