August 21, 2007

HousingPANIC Thought of the Day

It's time like these it kinda sucks we've lost our
manufacturing base, eh?



The manufacturing sector and its workers were hardest hit by the growth of Wal-Mart’s imports. Wal-Mart’s increased trade deficit with China eliminated 133,000 manufacturing jobs, 68% of those jobs lost from Wal-Mart’s imports. Jobs in the manufacturing sector pay higher wages and provide better benefits than most other industries, especially for workers with less than a college education.

52 comments:

Anonymous said...

"eliminated 133,000 manufacturing jobs"

That's all? Kind of low that figure.

Anonymous said...

How do you like all the toys and baby stuff contaminated with lead?

Welcome to the global economy!

Anonymous said...

US share of world manufacturing has not changed over the last 40 years. China's growth has taken share from Japan and Germany, not the US. The health of the manufacturing workforce in developed countries is the inverse of the health of the industry. US manufacturing is kicking butt and always has. Focus on output, not jobs or specific industries. Our manufacturing base is just fine. Keith you fell for it on this one.

Paula said...

We have been living in a collective fools' paradise for over 20 years. Gen X and Boomers will remember how the "service economy" was supposed to replace all that dirty heavy unstylish industry.

Well, this is what Wal-Mart, Starbucks, Abercrombie, pedicures, hairstyling, Century 21, and quadruple bypasses are allegedly doing. But they can't possibly create, economically, what a real manufacturing industry could.

We're about to finally figure that out. It's pretty late in the game, though.

Anonymous said...

Anonymous said...
US share of world manufacturing has not changed over the last 40 years. China's growth has taken share from Japan and Germany, not the US. The health of the manufacturing workforce in developed countries is the inverse of the health of the industry. US manufacturing is kicking butt and always has. Focus on output, not jobs or specific industries. Our manufacturing base is just fine. Keith you fell for it on this one.

---------------------

Oh really? Then where is all the "made in the USA" stuff? Please, put down the crack pipe.

Anonymous said...

Anonymous said...
US share of world manufacturing has not changed over the last 40 years. China's growth has taken share from Japan and Germany, not the US. The health of the manufacturing workforce in developed countries is the inverse of the health of the industry. US manufacturing is kicking butt and always has. Focus on output, not jobs or specific industries. Our manufacturing base is just fine. Keith you fell for it on this one.

August 21, 2007 10:44 PM

---------------------

Maybe if you classify hamburgers and subprime loans as "manufactured goods." Otherwise, not so much.

Tom said...

I created a petition called U.S. Tax Payers Against a Wall Street and Mortgage Bailout.

Please sign it and pass it on to other blogs and email lists.

http://www.petitiononline.com/bailout/petition.html

Anonymous said...

The Military Complex and Airspace industry are probably the only ones not dependent on 'outside' parts imports.

I haven't seen "Made in USA" for a while now. It's mostly "Made in China" and "Hecho en Mexico", but I've seen some unusual ones from Eastern Europe too (Romania, Belorussia, Moldova).

Anonymous said...

US share of world manufacturing has not changed over the last 40 years. China's growth has taken share from Japan and Germany, not the US. The health of the manufacturing workforce in developed countries is the inverse of the health of the industry. US manufacturing is kicking butt and always has. Focus on output, not jobs or specific industries. Our manufacturing base is just fine. Keith you fell for it on this one.

August 21, 2007 10:44 PM



WHAT?!?!?!?

Bush fucking reclassed burger flipping jobs to manufacturing jobs to make the numbers better! Goddamn manufacturing is out the window and Paco, Wong, or Singh has replaced it in THEIR cUntry!! Pull your head out of your ass man...

Anonymous said...

Case in point:

This morning I was pumping air into my rear tire using one of those $8 foot pumps. This is my 3rd one in the last year, the previous two were made in Mexico and fell apart a month or so after first use. This one is made in China, and I've been using it for a couple of month now. This morning it just freaking disintegrated... almost hurt myself.

I remember growing up in Soviet times when consumer products were harder to come by, but at least they were built properly, to last. I used my Soviet-built foot pump first for my bicycle, then my moped and then our family car. The silly thing was 15 years old when I left it.

I hear stories about farmers specifically looking for old equipment because of the way it was built to last. Not the cheap Chinese-made crap that is designed for one thing only - garbage dump.

smitty said...

"The Military Complex and Airspace industry are probably the only ones not dependent"

I think some of those things are being manufactured in China now too!

why not check the numbers said...

US manufacturing is in a boom time. It's just that rather than adding the jobs they've increased productivity. You can reduce the number of jobs and also increase output if you increase productivity enough - which is what has happened, not just in the US but everywhere.

And of course if the US dollar drops, US manufacturing becomes more competitive globally, which is good thing for manufacturing jobs.

Andy in San Diego said...

I was amazed to find some things like drinking glasses "Made in America" at Target. It's much harder to find than "Made in China", but I guess we still do make some things.

And speaking of Target, why do we always hear about Wal-Mart? Just because they're so big? If you add up Target, JCPenny, and all those other stores, they have to be contributing significantly to this whole globalization mess, too, right?

Budvar said...

"US share of world manufacturing has not changed over the last 40 years."

This is of course complete and utter horseshit, unless you truly believe that burger flipping and doughnut frying actually are part of manufacturing?

Anonymous said...

"US manufacturing is kicking butt and always has. Focus on output, not jobs or specific industries. Our manufacturing base is just fine."

Oh really, so why the absurd deficit?

Anonymous said...

The neocon plan is right on track,blow up the american middle class and our democracy,any one who does not believr it, is in denial.

kungpaochicken said...

"The Military Complex and Airspace industry are probably the only ones not dependent on 'outside' parts imports."

Not true anymore. All of the services buy supplies from Asia, things like uniforms, boots, even ammunition. Many semiconductor parts like transistors, LEDs, memory chips, etc., also are foreign sourced. About 70% of our oil and 20% of our gasoline is imported.

If these supplies were interrupted, it would take years to rebuild our domestic capabilities to manufacture some items. The F22 fighter went through an expensive re-design because many of the avionics parts Lockheed sourced ten years ago were no longer available when production started. The original suppliers were either out of business or stopped making Mil-Spec parts.

Precision machine tools are made in Asia now. If we had to gear up for an extended war effort we would be in the same situation as England in WWII. Our domestic industries are hollowed out and we'd have to beg and borrow to survive.

Anonymous said...

"If we had to gear up for an extended war effort we would be in the same situation as England in WWII. Our domestic industries are hollowed out and we'd have to beg and borrow to survive."

Yeah, but I got a cheap plasma to watch our downfall on. So it all evens out.

I think.

Jerry said...

I have a question for the board, and hope to get some discussion:
If the FED drops rates precipitously, (like 2-3 full basis points), over the next 6 months, then 3 questions
1. Will that help refinance exploding ARMs?
2. If the dollar drops any more, will foreign banks continue the game of "dont care how much we lose holding dollars!"
3. Can/Will the FED itself just start buying the worthless paper no one wants, and if they do, is the concept of money really finished?
My 2 cents:
1. only a drop in rates AND relaxed lending requirements can save the foreclosure wave to come.
2. Yes indeed, no matter how much the dollar falls foreign countries, mainly Japan and China will eat the loss and do nothing
3. I believe the FED will have no choice but to buy all the crap out there, a buyer of last resort if you will, and yes money at that point stops making any sense.

The sad thing is this is all gonna blow over and no really major damage will be done. Its kind of like being in "The Matrix", its not real, you know it, but you cant do anything about it!
Discuss

Anonymous said...

I have a question for the board, and hope to get some discussion:
If the FED drops rates precipitously, (like 2-3 full basis points), over the next 6 months, then 3 questions
1. Will that help refinance exploding ARMs?
2. If the dollar drops any more, will foreign banks continue the game of "dont care how much we lose holding dollars!"
3. Can/Will the FED itself just start buying the worthless paper no one wants, and if they do, is the concept of money really finished?
My 2 cents:
1. only a drop in rates AND relaxed lending requirements can save the foreclosure wave to come.
2. Yes indeed, no matter how much the dollar falls foreign countries, mainly Japan and China will eat the loss and do nothing
3. I believe the FED will have no choice but to buy all the crap out there, a buyer of last resort if you will, and yes money at that point stops making any sense.

The sad thing is this is all gonna blow over and no really major damage will be done. Its kind of like being in "The Matrix", its not real, you know it, but you cant do anything about it!
Discuss

Anonymous said...

"All of the services buy supplies from Asia, things like uniforms, boots, even ammunition."

---------------

It'll be fun trying to fight a war with China only to find out they have sold us defective and/or counterfeit ammunition!!!

Anonymous said...

"If we had to gear up for an extended war effort we would be in the same situation as England in WWII. Our domestic industries are hollowed out and we'd have to beg and borrow to survive."

-------------------

That's an understatement, to say the least. The British still had a manufacturing base back in 1939, much more so than early 21st century Amerika. They also had allies.

Anonymous said...

You guys need to read 'The End of Work' by Rifkin - this book predicted this manufacturing decline years ago - and the Chinese and Walmart are not even the most important part - AUTOMATION is.

There is no doubt that computer controlled machinery make more things faster and more precise and cheaper than ever before so this alone has crushed the manufacturing workforce all over the world. One vertical machining center today can do the work of dozens of manual machines for example.

What SUCKS is that sniveling conniving bean counters have been put in charge in corporations and their only perogative is the next quarters profit.

Thus, if you need quality or you need an unbroken domestic supply line, (like in a war scenario) you be screwed Jack. That's not China's fault and it's not the American worker's fault, it's the American BUYER'S fault and the AMERICAN investor's fault.

kochevnik

guy n. cognito said...

yeah, you can't fight wars on a "mature", services-based, debt-driven economy :-)

now don't get me wrong, the repetitive floor jobs you find in the textile industry are going to chase cheap labor around the globe... but if we keep trying to segregate development from manufacturing (keep the former, offshore the latter) then we'll lose EVERY high-tech manufacturing job. stuff like turbo-prop/engine and other gas turbines, drugs, computer crap (where does Dell get their stuff btw?)... all will be gone like the dodo. we'll lose them to India, Asia, any country where the kids rank higher than ours in science & math (just about every developed nation).

we are f'ed.

Anonymous said...

Hmm. While I'm disturbed by the latest Chinese poison scare- pajamas?!!?? American manufacturing isn't always the highest quality. My stupid Honda Civic is on 146K, has long since been paid off, and shows no signs of slowing down. I keep hearing that American cars have gotten better, but I'll save my money and wait a while to see. There are some things manufactured outside the US that are great. I just don't want to buy Christmas lights from the store for $.99 that I know were probably made by imprisoned Christian pastors (slaves) in China!

Anonymous said...

As Jay Leno said, "The Chinese thought their lead was contaminated with toys."

Anonymous said...

I went to a bicycle shop awhile ago. They had a bike there that cost $4,600. I kid you not. A two-wheel bike with no motor or anything.

I asked the owner where the bike was made and he said proudly: "Oh, the U.S.A. of course."

So, this is something we still make here: $4,600 carbon fiber bicycles that Wall Street yuppies can ride. Aren't you proud?

Capitaf said...

Assuming that you are correct about this loss in jobs, what is the alternative? The typical solution offered up is an isolationist policy, which brings jobs back to America by imposing an import tax. Keep in mind, such a policy only increases the prices of products to Americans; thereby decreasing everyone's purchasing power. As is illustrated by the recent problems in China, the free market will eventually show why it might be worth paying an extra 10% for products manufactured in the good 'ol US of A. It is a free market solution which, as free people, and as consumers who are free to choose amongst a variety of products, we should prefer the free market solution over increased Government involvement in the markets in the form of trade legislation and other isolationist policies.

Anonymous said...

La, la, la, la, la, I`m not listening, everything is going to be OK. We don`t need an industrial base to pull ourselves out of a depression like in the old days. La, la, la, la, la...

F W said...

Anon August 21, 2007 11:51 PM you are so on the money.

Only once they have destroyed the middle class can the up and coming socialists gain more control over us and our economy.

And what better way to usher in the new Amero than to destroy the once almighty Buck?

We need another Boston Tea Party.

have you looked at the stats? said...

There's a trade deficit because imports are greater than exports. It doesn't take much of brain to realise that that doesn't mean exports have gone down, it just means imports have increased more (or decreased less) than exports have.

http://www.census.gov/foreign-trade/statistics/historical/goods.txt

So lets compare the last surplus year to 2006...

In 1975 US exports were $107.1 trillion and imports were $98.2 trillion. Hooray a surplus for you "deficit bad, surplus good" simpletons.

In 2006 US export were $1,023.1 trillion and imports were $1,861.4 trillion. Oh no a deficit!!!

Note that's just the goods total, I'm ignoring services since apprently in these parts they count for nothing.

Just a minute exports are 755% up.

Oh but inflation, I believe in real terms one 1975 dollar is worth four 2006 dollars.

So there's only been a 40% real increase in US exports. Pretty good considering the manufacturing base has been destroyed!

Sure that's not that much per year, but up seems the opposite of a destroyed manufacturing sector.

Maybe there's a deficit because, oh I don't know, imports are up even more. Because, yes, the US doesn't have the manufacturing base to meet the demand of US consumers for a new TV every 6 months, and clothes that you buy new instead of washing because they're cheaper than soap... But US citizens don't need that crap when push comes to shove anyway.

Anonymous said...

*


They get the work,

We get the cheap crap!

Yeah!

Anonymous said...

I'm the original ANON

US share of world manufacturing is 22% just as it was in 1995.

http://tinyurl.com/2zrrln

China gained 4%, Japan lost 4% because the Japanese protected their manufacturing jobs. (Not all of Japan is wonderful like Toyota. Plenty of do nothing morons looking out the window in Japan's economy).

No one worries about our "farming base" even though farming employment was decimated (now 3% of the US population in farming).

Don't confuse competitiveness (share of world output) with employment.

And if you want to kill the messenger, go right ahead.

Huputuutu said...

why not check the numbers said...

US manufacturing is in a boom time. It's just that rather than adding the jobs they've increased productivity. You can reduce the number of jobs and also increase output if you increase productivity enough - which is what has happened, not just in the US but everywhere.

And of course if the US dollar drops, US manufacturing becomes more competitive globally, which is good thing for manufacturing jobs.

August 21, 2007 11:29 PM
================================
So where are all the products with "made in USA" on them?

zoiks said...

kungpaochicken, don't forget America is *very* good at manufacturing bad loans to deadbeat borrowers. In fact, they're such good loans we export the notes to the world!

Woohoo! Deadbeat credit for the world!

In an extended war effort we could borrow our way to victory while we send the debt notes to our evil enemies. Bad debt is probably better than nuclear bombs!

james said...

"US share of world manufacturing has not changed over the last 40 years."



Um, references? Other than Bush campaign speeches and fox news?

depresso said...

Typical anti-walmart, anti-capitalist commie bullshit

pka4lif said...

Union greed owns a portion of the responsability as well....

Anonymous said...

"Not the cheap Chinese-made crap"

I remeber when we used to say the exact same thing about "made in Japan"

SPECTRE of Deflation said...

Keith, ya won't believe it. The FED is accepting boat loans and junk paper still marked to market [Goldilocks]. They have truly become the lender of last resort. PATHETIC! Can we say monetize the debt?

Fed's Strategy of Increasing Liquidity Survives for a Third Day

By Craig Torres

Aug. 22 (Bloomberg) -- The Federal Reserve's strategy of increasing liquidity rather than resorting to a cut in the benchmark interest rate survived a third day.

Yields on Treasury bills rose yesterday after the New York Fed lowered the cost of borrowing securities from its own portfolio to ease a shortage in the market. The action followed a reduction in the Fed's rate on direct loans to banks on Aug. 17, the impact of which officials said they need time to assess.

Chairman Ben S. Bernanke wants to avoid an emergency easing of monetary policy, contrasting with predecessor Alan Greenspan, who cut the federal funds rate target three times in 1998 after the collapse of Long Term Capital Management LP. Richmond Fed Bank President Jeffrey Lacker said yesterday that policy must be guided by the outlook for economic growth and prices, not entirely by markets.

``We did use the fed funds rate and that may have been a mistake,'' said former Fed Vice Chairman Alice Rivlin, who voted for the 1998 rate cuts. ``It might have been smarter to try what they are trying.''

Lacker said in a speech to a conference in Charlotte, North Carolina yesterday that while the credit crunch and gyrations in financial markets has the potential to hurt growth, signs so far indicate business and consumer spending will continue.

In response to a question, Lacker also underscored the Federal Open Market Committee's determination not to insure poor investments with a cut in the federal funds rate.

`Our Responsibility'

``The Federal Reserve isn't responsible for the size of credit spreads,'' he said. ``We leave those to be market determined. Our responsibility and what we are capable of influencing on a sustained basis is inflation and growth.''

After the rate cuts in 1998, the economy strengthened and stock prices soared, Rivlin noted, leaving the Fed open to criticism that the reductions were a mistake. Rivlin is now director of the economic studies program at the Brookings Institution in Washington.

The Fed's current strategy showed some signs of success yesterday as yields on three-month Treasury bills climbed the most since 2000 and those on commercial paper backed by assets such as mortgages slipped.

The three-month bill yield increased 0.52 percentage point to 3.61 percent late yesterday as demand for the shortest-dated government debt waned. Top-rated asset-backed commercial paper maturing in one day yielded 5.92 percent, down from 5.99 percent, posting the first drop in three trading days.

``The flight to safety may be diminishing a bit,'' said Holly Liss, a bond saleswoman in Chicago at Citigroup Global Markets Inc. ``We're seeing more calming of the market as T-bill rates come back to normal.''

Jury Still Out

Lacker said the ``jury is still out'' on whether the Fed has done enough to improve trading in the $1.1 trillion market for asset-backed commercial paper.

Investors and economists still bet that Bernanke will have to reduce the benchmark lending rate between banks, now at 5.25 percent, by at least a quarter point on or before the Sept. 18 meeting.

``Financial volatility and the seizing up of credit markets raises the probability'' of a recession, said Steven Einhorn, vice chairman of New York hedge fund Omega Partners Inc. ``The Fed needs to be proactive and not wait.''

Einhorn said slowing inflation and growth of around 2 percent to 2.5 percent give the Fed room to cut interest rates.

`All of the Tools'

Senate Banking Committee Chairman Christopher Dodd said Bernanke agreed to use ``all of the tools at his disposal'' to restore stability in markets roiled by the subprime mortgage crisis. He added that he didn't ask Bernanke to cut the federal funds rate and that the Fed chief didn't pledge to do so.

Dodd, a Connecticut Democrat who is seeking his party's presidential nomination, said banks should take advantage of lower borrowing costs at the discount window. He spoke after meeting with Bernanke and U.S. Treasury Secretary Henry Paulson.

Yesterday, the New York Fed reduced the so-called minimum fee rate that bond dealers pay to borrow its Treasuries to 0.5 percent from 1 percent.

``We are doing it to provide additional liquidity to the Treasury financing market,'' said Andrew Williams, a spokesman for the New York Fed. He said the rate was the lowest in the history of the program, which has existed in its current form since 1999.

The central bank on Aug. 17 cut the so-called discount rate half a percentage point to 5.75 percent to direct more cash to companies starved for short-term financing while avoiding an emergency reduction in its broader lending-rate target.

Banks can borrow at the discount rate with a wide variety of collateral, including everything from mortgages -- the market that sparked the credit crunch after defaults rose to the highest in five years -- to municipal bonds.

Lacker told risk managers yesterday that the Fed's district banks would even accept boat loans as collateral. It's up to the banks to establish a value for the assets as they make the loan, he said.

To contact the reporter on this story: Craig Torres in Washington at ctorres3@bloomberg.net

burdman said...

How can you have manufacturing after taking shop classes out of the schools? Our parents and educators wanted everyone to go to college and be a manager at Wallymart and not a lowly blue-collar factory worker.

Anonymous said...

"Typical anti-walmart, anti-capitalist commie bullshit "

Typical simple-minded listener of the Sean Hannity show.

LuvthatBushieguy said...

pka4lif said...
Union greed owns a portion of the responsability as well....

August 22, 2007 7:30 AM
===================================
Wheww....thats a relief. I was worried that CEO greed/incompetence might be part of of the problem.

Say, who agreed to those labor contracts anyway? Would it have been the CEO's.............

Anonymous said...

I'm from Akron OH and they used to be the tire capital of the world, but those jobs are now long gone.

Anybody who thinks we have a strong manufacturing base is freaking retarded.

Anonymous said...

Anonymous said...
You guys need to read 'The End of Work' by Rifkin - this book predicted this manufacturing decline years ago - and the Chinese and Walmart are not even the most important part - AUTOMATION is.

There is no doubt that computer controlled machinery make more things faster and more precise and cheaper than ever before so this alone has crushed the manufacturing workforce all over the world. One vertical machining center today can do the work of dozens of manual machines for example.

What SUCKS is that sniveling conniving bean counters have been put in charge in corporations and their only perogative is the next quarters profit.

Thus, if you need quality or you need an unbroken domestic supply line, (like in a war scenario) you be screwed Jack. That's not China's fault and it's not the American worker's fault, it's the American BUYER'S fault and the AMERICAN investor's fault.

kochevnik

August 22, 2007 1:25 AM

----------------------

If automation, and not offshoring, was really the issue, then wouldn't all the crap we currently import from China still be made in the USA instead? We would have much better quality and safer products and would not have this gaping wound of a trade deficit, not to mention being in the strategically vulnerable position of being dependent on a potential rival.

Anonymous said...

"I just don't want to buy Christmas lights from the store for $.99 that I know were probably made by imprisoned Christian pastors (slaves) in China!"

--------------------

Yeah, having your house burn down because of defective Chinese Christmas lights would not be a pleasant way to spend the holidays.

Anonymous said...

Capitaf said...
Assuming that you are correct about this loss in jobs, what is the alternative? The typical solution offered up is an isolationist policy, which brings jobs back to America by imposing an import tax. Keep in mind, such a policy only increases the prices of products to Americans; thereby decreasing everyone's purchasing power. As is illustrated by the recent problems in China, the free market will eventually show why it might be worth paying an extra 10% for products manufactured in the good 'ol US of A. It is a free market solution which, as free people, and as consumers who are free to choose amongst a variety of products, we should prefer the free market solution over increased Government involvement in the markets in the form of trade legislation and other isolationist policies.

August 22, 2007 2:34 AM

----------------------

I don't have the option of paying 10% more for US-made goods. The choice has been made for me by Walmart.

Why do people really believe this corporatist propaganda that "protectionism" is a bad thing?

Wake up sheeple!!

Anonymous said...

Anonymous said...
"Not the cheap Chinese-made crap"

I remeber when we used to say the exact same thing about "made in Japan"

August 22, 2007 11:15 AM

--------------------

Did the Japanese ever send over any toys and baby bibs contaminated with lead? The Japanese EARNED a reputation for high quality products. The Chinese don't seem to be making much progress in that direction, which I guess is OK with them, since they are still succeeding in destroying the US industial base while building up their own. Given that, they don't even mind so much that they get paid in pieces of paper with numbers on them instead of real money. For now, those pieces of paper still have some purchasing power, so it's kind of like they are being paid develop their industries while bombing ours into the ground.

One more thing... You sheeple need to realize that there is a big, big, huge freaking difference between China and Japan and stop lumping them into one category.

Anonymous said...

"huge freaking difference between China and Japan and stop lumping them into one category."

I agree, stuff made in Japan is stuff made by Japanese corporations. Stuff made in China is really our corporations having Chinese build cheap crap.

Anonymous said...

Anonymous said...
"huge freaking difference between China and Japan and stop lumping them into one category."

I agree, stuff made in Japan is stuff made by Japanese corporations. Stuff made in China is really our corporations having Chinese build cheap crap.

August 22, 2007 10:31 PM

----------------------

That's somewhat true, but largely irrelevant.

There are far more important differences between Japan and China.

Anonymous said...

I think it's very relevant. We're building up the Chinese. They wouldn't be as far as along if it wasn't for our jobs being sent over there. That's just my opinion.

Anonymous said...

Anonymous said...
I think it's very relevant. We're building up the Chinese. They wouldn't be as far as along if it wasn't for our jobs being sent over there. That's just my opinion.

August 23, 2007 12:16 AM

-----------------------

That's exactly right. The Chinese century is brought to you by unchecked corporate greed on the part US, European, and Japanese corporations. And those factories they built in China that they think they own -- well they own them only as long as it suits the purposes of the mafiosos running the Chinese government. It's not just consumer goods. The Chinese also got a hold of superior rocket technology without having to do any of the hard work involved in actually developing it themselves. See for example:

http://en.wikipedia.org/wiki/Loral