The Grinches of the Far East

Those wicked Chinese! According to this vigilant piece at The Week, if you can't afford as many Christmas gifts as you'd like this year, it's all their fault. And why? Because greedy Chinese workers are getting paid more than they used to.

Economists note that labor costs in China have been on the rise for years, but they are now reaching a point where exporters can't simply absorb them and they're getting passed on to the customer.

I've written about this before, but I decided it was worth repeating now that The Week is taking this, well, Christlike stand, showing its compassion for American consumers but putting the blame where it really belongs: on Chinese workers who are finally starting to earn more than $125 a year. Just so regular Americans will know who their real enemies are, you know?

But not to worry: The Week even offers us some hope, and we know how important hope is:

What now?
It's expected that Chinese labor costs will continue to go up and up, but that might not be a bad thing. According to a recent study, as analyzed by the Boston Consulting Group, labor costs in China will reach a "tipping point" by 2015. At that juncture, Chinese labor will be so expensive that various industries could move their manufacturing operation to the U.S. and generate millions of new jobs.

And, if our corporate overlords get their way, they'll move Chinese wages and working conditions here, just like we had them in the old days. After all, Chinese capitalists learned from us. In return, we can export American unemployment to China. Remember: it's more blessed to give than to receive!

The Grinches of the Far East

Those wicked Chinese! According to this vigilant piece at The Week, if you can't afford as many Christmas gifts as you'd like this year, it's all their fault. And why? Because greedy Chinese workers are getting paid more than they used to.

Economists note that labor costs in China have been on the rise for years, but they are now reaching a point where exporters can't simply absorb them and they're getting passed on to the customer.

I've written about this before, but I decided it was worth repeating now that The Week is taking this, well, Christlike stand, showing its compassion for American consumers but putting the blame where it really belongs: on Chinese workers who are finally starting to earn more than $125 a year. Just so regular Americans will know who their real enemies are, you know?

But not to worry: The Week even offers us some hope, and we know how important hope is:

What now?
It's expected that Chinese labor costs will continue to go up and up, but that might not be a bad thing. According to a recent study, as analyzed by the Boston Consulting Group, labor costs in China will reach a "tipping point" by 2015. At that juncture, Chinese labor will be so expensive that various industries could move their manufacturing operation to the U.S. and generate millions of new jobs.

And, if our corporate overlords get their way, they'll move Chinese wages and working conditions here, just like we had them in the old days. After all, Chinese capitalists learned from us. In return, we can export American unemployment to China. Remember: it's more blessed to give than to receive!

Every Knee Shall Bow and Every Tongue Confess the Name of Nike

Today I'm reading China in Ten Words (Pantheon, 2011) by Yu Hua. Born in 1960, Yu grew up during the Cultural Revolution in conditions of moderate poverty (which means he was hungry most of the time, but not hungry enough to die of it), though both his parents were medical doctors. In these essays, he contrasts his memories of China's recent past with its drastically changed present, but he's not interested in oversimplifying the present either. After I'd started reading the book, I looked again at the blurbs on the back cover, especially this one from Orville Schell, a longtime writer on East Asia.

In this era of the China Boom, when Communist Party officials are so inclined to erase the travails of their country's past from public consciousness, Yu Hua's insistence on remembering comes as an almost shocking intrusion into a willful state of amnesia. His earthy, even ribald, meditations on growing up in small-town China during Mao's Cultural Revolution remind us of just how twisted China's progress into the present has been and how precariously balanced its success story actually still is.

Ah, the State of Amnesia! It ought to be admitted to the Union officially, it's so essential to our nationhood. For any American to dwell on another nation's will to amnesia is disingenuous. Schell has his own history as a critic of US policy in East Asia, especially Vietnam, but from this paragraph it sounds like he's been reabsorbed into the American elite that spawned him. There's nothing exactly false in what he wrote, though; it's just a wee bit one-sided. Advocates of capitalist "reforms" in the US don't want to think about the human cost of China's "progress into the present" either -- well, the Right is concerned about the plight of Christians there, it's true, and the Liberal-Left is very concerned about dangerous child toys we import from China. But the human cost to Chinese? Not so much.

For example, in "Disparity" Yu recounts this story, which he heard from his "friend Cui Yongyuan, an anchorman on China Central Television," who,

In May 2006, ... began to retrace the route of the Red Army’s Long March, along with his film crew and twenty-six other people from different walks of life. It took them 250 days to travel the 3,800 miles …

By the summer of that year, just when the soccer World Cup finals were taking place in Germany, Cui’s miniature Long March expedition arrived at an impoverished area in China’s southwest, and there he had a sudden inspiration to organize a soccer match for the local primary school children. Even if it was a far cry from the passions of Berlin, he thought, at least it would create a little ripple of World Cup excitement in this backward hinterland county.

He immediately encountered two problems. The first was that no soccer ball could be found in the stores of the county town, so he had to send two fellow Long Marchers off in a car to a bigger city to buy one. The second was that the local primary school children not only had never seen a soccer match; they had never even heard that such a game existed [155-6].

From the context that Yu provides, it's clear that never having heard of soccer is the least of these children's disadvantages. Cui's cluelessness would, I feel sure, be echoed by most Americans on learning that these children had never heard of the Superbowl. Someone would probably start a charity to bring that and other similar blessings of civilization to these poor unfortunates.

Yu knows better, though. A bit later in the same essay he talks about poverty in China. He says that around a hundred million Chinese earn no more than 800 yuan (US $125.99) per year, and tells this story:

When I pointed this out at a talk in Vancouver in 2009, a Chinese student rose to his feet. “Money is not the sole criterion for judging happiness,” he objected. This remark made me shudder, for it is not just a single student’s view; a substantial number of people in China today would take a similar line. Surrounded by images of China’s growing prosperity, they have not the slightest inclination to concern themselves with the hundred million who still struggle in unimaginable poverty. That is the real tragedy: poverty and hunger are not as shocking as willful indifference to them. As I told the Chinese student, the issue is not how we judge happiness but how we address a widespread social problem. “If you are someone with an annual income of only 800 yuan, you will earn a lot of respect for saying what you did,” I replied. “But you’re not.”

China isn't a Christian country, but it has traditions of concern for the poor, however inadequately they were carried out in practice. Communism took them further, however badly Mao's regime carried them out in practice. Capitalism has no such tradition, and Yu's story reminded me that when I see right-wing Christians on Facebook call for putting Christ back into Christmas and God back into America, they never talk about poverty, in the US or elsewhere. (The closest I've seen anyone come to it was in the immediate aftermath of last year's earthquake in Haiti, when one Christian Facebook friend complained that though people go to bed hungry in the US, "we have a benefit for the people of Haiti on 12 stations." But she didn't want universal healthcare, because it would help "illegal immigrants.") All that matters to them is that there be a Christmas tree in the White House, that no one says "Happy Holidays", that everyone says "under God" in the Pledge of Allegiance, and that we support our troops -- until they come home, at which point who cares? None of these concerns can be found anywhere in the New Testament, but one theme that runs through both testaments is care of the poor. "Sell all you have and give to the poor" is one of those teachings of Jesus like "There are those who make themselves eunuchs for the Kingdom of Heaven" -- all very well in his day, no doubt, but no longer relevant in ours.

At another points of the political spectrum, blame is laid at the feet of the poor for having too many children, a familiar theme from a century ago. China was the culprit then, and there was more fuss in the US about the prospect of a billion Chinese than there ever was about a billion Hindus, though I think India got there first. And probably there are more human beings than we can support; the trouble is that there's very little serious attempt to support them. Instead we get distractions, like China's capitalist "reforms." As Raymond Williams wrote in "Socialism and Ecology," twenty or thirty years ago, it's an error that even the great socialist theorists couldn't seem to avoid:

Because of course these attitudes of mastering and conquering had from beginning been associated not just with mastering the earth, or natural substances, or making water do what you wanted, but with pushing other people around, with going wherever there were things which you wanted, and subjugating and conquering. That’s where the metaphors of conquest and mastery came from. They were a classic rationale of imperialism in just that expanding phase. They were from the whole internal ethic of an expanding capitalism: to master nature, to conquer it, to shift it around to do what you want with it. Engels went along with that and then suddenly remembered where the metaphor came from and said, quite correctly: we shall never understand this if we fail to remember that we are ourselves part of nature, and that what is involved in this mastery and conquest is going to going to have its effects on us; we can’t just arrive and depart as a foreign conqueror. But then he shifted back, under the influence of this very strong nineteenth-century triumphalism about nature, and took up the metaphors again. And still today we tread these triumphalist arguments about production. They are a bit less confident now, but if you read the typical case for socialism, as it became standard between the wars in the dominant tendency, it is all in terms of mastering nature, setting new human horizons, creating plenty as the answer to poverty...

It has always been a running argument within the Labour Party, especially since 1945, whether we’re going to get equality, and what are usually referred to as ‘the things we all want’ – schools and hospitals are usually the first to be named – when we’ve got the economy right, when we’ve produced enough, enlarged the national cake and so on; or whether equality and the priority of human needs require, as their first and necessary condition, fundamental changes in our social and economic institutions and relationships. I think we now have to see that argument as settled. The usual ‘national cake’ position, the soft political option, can be seen to rest on a basic fallacy, which the United States has demonstrated to the world – and no society is every going to be relatively richer in gross indiscriminate production than that one – that by getting to a certain level of production you solve the problems of poverty and inequality. Tell them that in the slums, the inner cities, of rich America! All socialists are then forced to recognize that we have to intervene on quite a different basis. We have to say, as Tawney said sixty years ago, that no society is too poor to afford a right order of life. And no society is so rich that it can afford to dispense with a right order, or hope to get it merely by becoming rich. This is in my view the central socialist position. We can never accept so-called solutions to our social and economic problems which are based on the usual crash programmes of indiscriminate production, after which we shall get ‘the things we all want’. By the ways in which we produce, and the ways in which we organize production and its priorities – including, most notably, the inherent capitalist priority of profit – we create social relations which then determine how we distribute the production and how people actually live [reprinted in Resources of Hope (Verso, 1989), 214, 222].

Reading Hua's account, I remembered something the American historian Stephen F. Cohen wrote about Russia in the 1990s, in his Failed Crusade (Norton, 2000):

Many American correspondents clearly did not like "doom and gloom" stories about unpaid wages and pensions, malnutrition, and decaying provinces, where, a Russian journalist tells us, "desperation touches everyone." (Newsweek's correspondent advised the poor to continue living on bread: "They could do worse.") ... American journalists found instead preferable "metaphors for Russia's metamorphosis" -- usually in the tiny segment of Moscow society that had prospered, from financial oligarchs to yuppies spawned by the temporary proliferation of Western enterprises.

Thus, for a Washington Post columnist who had recently been a correspondent, an especially successful insider beneficiary of state assets was a progressive "baby billionaire" and, for the Wall Street Journal, a "Russian Bill Gates." For many others, like a New York Times editorial writer and also former Moscow correspondent, "One of the best seats for observing the new Russia is on the terrace outside the cavernous McDonald's [that] serves as a mecca for affluent young Muscovites. They arrive in Jeep Cherokees and Toyota Land Cruisers, cell phones in hand." In the New Russia at that time, the average monthly wage, when actually paid, was about sixty dollars, and falling [16-17].

It's more or less the same for American media covering American people: the rich and fabulous are the real America, the other ninety-nine percent or so don't count and barely exist. So why not take the same approach when covering China or the former Soviet Union?

Yu Hua doesn't care to forget the rest of the population, so he won't let you, or his Chinese readers, forget them either. But then he's not one of China's New Class of rich people, though the New York Times claims that, because his novels have sold well, he "has gone on to receive an ample share of the fruits of capitalism" (Yu alludes to this interview in China in Ten Words). He benefited from the cultural openings of the 1980s to become a writer, but he also benefited from Chinese political and economic egalitarianism:

In China during the 1980s, a doctor wasn’t any richer than a worker. The doctors then were all poor bastards. They were given fixed wages by the government. So I gave up being a dentist to work at a cultural center without suffering any stress either emotionally or economically. On the contrary, I felt so happy I nearly woke up smiling. I turned from being a poor bastard who worked his ass off every day into a poor bastard who had a jolly good time every day. I was still a poor bastard, but a poor bastard in the cultural center who had every minute to himself.

And Yu has no illusions about capitalism any more than he did about communism. He told the Times interviewer, "These young nationalists have no sense of ambivalence, no idea of life’s ambiguities. But when times are hard, their attitude will change, become more mature, and because capitalism in this form cannot go on in China, it has to end, those hard times will come soon." For most Chinese, they never went away.

Every Knee Shall Bow and Every Tongue Confess the Name of Nike

Today I'm reading China in Ten Words (Pantheon, 2011) by Yu Hua. Born in 1960, Yu grew up during the Cultural Revolution in conditions of moderate poverty (which means he was hungry most of the time, but not hungry enough to die of it), though both his parents were medical doctors. In these essays, he contrasts his memories of China's recent past with its drastically changed present, but he's not interested in oversimplifying the present either. After I'd started reading the book, I looked again at the blurbs on the back cover, especially this one from Orville Schell, a longtime writer on East Asia.

In this era of the China Boom, when Communist Party officials are so inclined to erase the travails of their country's past from public consciousness, Yu Hua's insistence on remembering comes as an almost shocking intrusion into a willful state of amnesia. His earthy, even ribald, meditations on growing up in small-town China during Mao's Cultural Revolution remind us of just how twisted China's progress into the present has been and how precariously balanced its success story actually still is.

Ah, the State of Amnesia! It ought to be admitted to the Union officially, it's so essential to our nationhood. For any American to dwell on another nation's will to amnesia is disingenuous. Schell has his own history as a critic of US policy in East Asia, especially Vietnam, but from this paragraph it sounds like he's been reabsorbed into the American elite that spawned him. There's nothing exactly false in what he wrote, though; it's just a wee bit one-sided. Advocates of capitalist "reforms" in the US don't want to think about the human cost of China's "progress into the present" either -- well, the Right is concerned about the plight of Christians there, it's true, and the Liberal-Left is very concerned about dangerous child toys we import from China. But the human cost to Chinese? Not so much.

For example, in "Disparity" Yu recounts this story, which he heard from his "friend Cui Yongyuan, an anchorman on China Central Television," who,

In May 2006, ... began to retrace the route of the Red Army’s Long March, along with his film crew and twenty-six other people from different walks of life. It took them 250 days to travel the 3,800 miles …

By the summer of that year, just when the soccer World Cup finals were taking place in Germany, Cui’s miniature Long March expedition arrived at an impoverished area in China’s southwest, and there he had a sudden inspiration to organize a soccer match for the local primary school children. Even if it was a far cry from the passions of Berlin, he thought, at least it would create a little ripple of World Cup excitement in this backward hinterland county.

He immediately encountered two problems. The first was that no soccer ball could be found in the stores of the county town, so he had to send two fellow Long Marchers off in a car to a bigger city to buy one. The second was that the local primary school children not only had never seen a soccer match; they had never even heard that such a game existed [155-6].

From the context that Yu provides, it's clear that never having heard of soccer is the least of these children's disadvantages. Cui's cluelessness would, I feel sure, be echoed by most Americans on learning that these children had never heard of the Superbowl. Someone would probably start a charity to bring that and other similar blessings of civilization to these poor unfortunates.

Yu knows better, though. A bit later in the same essay he talks about poverty in China. He says that around a hundred million Chinese earn no more than 800 yuan (US $125.99) per year, and tells this story:

When I pointed this out at a talk in Vancouver in 2009, a Chinese student rose to his feet. “Money is not the sole criterion for judging happiness,” he objected. This remark made me shudder, for it is not just a single student’s view; a substantial number of people in China today would take a similar line. Surrounded by images of China’s growing prosperity, they have not the slightest inclination to concern themselves with the hundred million who still struggle in unimaginable poverty. That is the real tragedy: poverty and hunger are not as shocking as willful indifference to them. As I told the Chinese student, the issue is not how we judge happiness but how we address a widespread social problem. “If you are someone with an annual income of only 800 yuan, you will earn a lot of respect for saying what you did,” I replied. “But you’re not.”

China isn't a Christian country, but it has traditions of concern for the poor, however inadequately they were carried out in practice. Communism took them further, however badly Mao's regime carried them out in practice. Capitalism has no such tradition, and Yu's story reminded me that when I see right-wing Christians on Facebook call for putting Christ back into Christmas and God back into America, they never talk about poverty, in the US or elsewhere. (The closest I've seen anyone come to it was in the immediate aftermath of last year's earthquake in Haiti, when one Christian Facebook friend complained that though people go to bed hungry in the US, "we have a benefit for the people of Haiti on 12 stations." But she didn't want universal healthcare, because it would help "illegal immigrants.") All that matters to them is that there be a Christmas tree in the White House, that no one says "Happy Holidays", that everyone says "under God" in the Pledge of Allegiance, and that we support our troops -- until they come home, at which point who cares? None of these concerns can be found anywhere in the New Testament, but one theme that runs through both testaments is care of the poor. "Sell all you have and give to the poor" is one of those teachings of Jesus like "There are those who make themselves eunuchs for the Kingdom of Heaven" -- all very well in his day, no doubt, but no longer relevant in ours.

At another points of the political spectrum, blame is laid at the feet of the poor for having too many children, a familiar theme from a century ago. China was the culprit then, and there was more fuss in the US about the prospect of a billion Chinese than there ever was about a billion Hindus, though I think India got there first. And probably there are more human beings than we can support; the trouble is that there's very little serious attempt to support them. Instead we get distractions, like China's capitalist "reforms." As Raymond Williams wrote in "Socialism and Ecology," twenty or thirty years ago, it's an error that even the great socialist theorists couldn't seem to avoid:

Because of course these attitudes of mastering and conquering had from beginning been associated not just with mastering the earth, or natural substances, or making water do what you wanted, but with pushing other people around, with going wherever there were things which you wanted, and subjugating and conquering. That’s where the metaphors of conquest and mastery came from. They were a classic rationale of imperialism in just that expanding phase. They were from the whole internal ethic of an expanding capitalism: to master nature, to conquer it, to shift it around to do what you want with it. Engels went along with that and then suddenly remembered where the metaphor came from and said, quite correctly: we shall never understand this if we fail to remember that we are ourselves part of nature, and that what is involved in this mastery and conquest is going to going to have its effects on us; we can’t just arrive and depart as a foreign conqueror. But then he shifted back, under the influence of this very strong nineteenth-century triumphalism about nature, and took up the metaphors again. And still today we tread these triumphalist arguments about production. They are a bit less confident now, but if you read the typical case for socialism, as it became standard between the wars in the dominant tendency, it is all in terms of mastering nature, setting new human horizons, creating plenty as the answer to poverty...

It has always been a running argument within the Labour Party, especially since 1945, whether we’re going to get equality, and what are usually referred to as ‘the things we all want’ – schools and hospitals are usually the first to be named – when we’ve got the economy right, when we’ve produced enough, enlarged the national cake and so on; or whether equality and the priority of human needs require, as their first and necessary condition, fundamental changes in our social and economic institutions and relationships. I think we now have to see that argument as settled. The usual ‘national cake’ position, the soft political option, can be seen to rest on a basic fallacy, which the United States has demonstrated to the world – and no society is every going to be relatively richer in gross indiscriminate production than that one – that by getting to a certain level of production you solve the problems of poverty and inequality. Tell them that in the slums, the inner cities, of rich America! All socialists are then forced to recognize that we have to intervene on quite a different basis. We have to say, as Tawney said sixty years ago, that no society is too poor to afford a right order of life. And no society is so rich that it can afford to dispense with a right order, or hope to get it merely by becoming rich. This is in my view the central socialist position. We can never accept so-called solutions to our social and economic problems which are based on the usual crash programmes of indiscriminate production, after which we shall get ‘the things we all want’. By the ways in which we produce, and the ways in which we organize production and its priorities – including, most notably, the inherent capitalist priority of profit – we create social relations which then determine how we distribute the production and how people actually live [reprinted in Resources of Hope (Verso, 1989), 214, 222].

Reading Hua's account, I remembered something the American historian Stephen F. Cohen wrote about Russia in the 1990s, in his Failed Crusade (Norton, 2000):

Many American correspondents clearly did not like "doom and gloom" stories about unpaid wages and pensions, malnutrition, and decaying provinces, where, a Russian journalist tells us, "desperation touches everyone." (Newsweek's correspondent advised the poor to continue living on bread: "They could do worse.") ... American journalists found instead preferable "metaphors for Russia's metamorphosis" -- usually in the tiny segment of Moscow society that had prospered, from financial oligarchs to yuppies spawned by the temporary proliferation of Western enterprises.

Thus, for a Washington Post columnist who had recently been a correspondent, an especially successful insider beneficiary of state assets was a progressive "baby billionaire" and, for the Wall Street Journal, a "Russian Bill Gates." For many others, like a New York Times editorial writer and also former Moscow correspondent, "One of the best seats for observing the new Russia is on the terrace outside the cavernous McDonald's [that] serves as a mecca for affluent young Muscovites. They arrive in Jeep Cherokees and Toyota Land Cruisers, cell phones in hand." In the New Russia at that time, the average monthly wage, when actually paid, was about sixty dollars, and falling [16-17].

It's more or less the same for American media covering American people: the rich and fabulous are the real America, the other ninety-nine percent or so don't count and barely exist. So why not take the same approach when covering China or the former Soviet Union?

Yu Hua doesn't care to forget the rest of the population, so he won't let you, or his Chinese readers, forget them either. But then he's not one of China's New Class of rich people, though the New York Times claims that, because his novels have sold well, he "has gone on to receive an ample share of the fruits of capitalism" (Yu alludes to this interview in China in Ten Words). He benefited from the cultural openings of the 1980s to become a writer, but he also benefited from Chinese political and economic egalitarianism:

In China during the 1980s, a doctor wasn’t any richer than a worker. The doctors then were all poor bastards. They were given fixed wages by the government. So I gave up being a dentist to work at a cultural center without suffering any stress either emotionally or economically. On the contrary, I felt so happy I nearly woke up smiling. I turned from being a poor bastard who worked his ass off every day into a poor bastard who had a jolly good time every day. I was still a poor bastard, but a poor bastard in the cultural center who had every minute to himself.

And Yu has no illusions about capitalism any more than he did about communism. He told the Times interviewer, "These young nationalists have no sense of ambivalence, no idea of life’s ambiguities. But when times are hard, their attitude will change, become more mature, and because capitalism in this form cannot go on in China, it has to end, those hard times will come soon." For most Chinese, they never went away.

The People's Democratic Republic of Luna

One of the latest viral memes is this photo from China:



It's drawn a lot of attention in the West, like this article at Salon by Drew Grant, "North Korea, most of Asia terrible at Photoshop." They're not too terrible, since the North Korean photo Grant reproduces was picked up by the Associated Press and only disavowed a day later.



Not only that, but Chinese Photoshop mavens (among others) are playing with the image, showing that "Asia" is pretty good at Photoshop; just not its governments. I especially like this one, which shows how levitation is really done:



I'm also partial to this one, from the same source:



But now I'm reminded of a photograph of alleged Sandinista or Salvadoran rebel atrocities from the 1980s that was picked up by US media and continued to run even after it had been discredited. I'll have to see if I can track it, or at least the story, down.



By the way, it looks like I've passed the 1000-post mark. Just sayin'.

The People's Democratic Republic of Luna

One of the latest viral memes is this photo from China:



It's drawn a lot of attention in the West, like this article at Salon by Drew Grant, "North Korea, most of Asia terrible at Photoshop." They're not too terrible, since the North Korean photo Grant reproduces was picked up by the Associated Press and only disavowed a day later.



Not only that, but Chinese Photoshop mavens (among others) are playing with the image, showing that "Asia" is pretty good at Photoshop; just not its governments. I especially like this one, which shows how levitation is really done:



I'm also partial to this one, from the same source:



But now I'm reminded of a photograph of alleged Sandinista or Salvadoran rebel atrocities from the 1980s that was picked up by US media and continued to run even after it had been discredited. I'll have to see if I can track it, or at least the story, down.



By the way, it looks like I've passed the 1000-post mark. Just sayin'.

China buying Gold hand over fist

The Chinese worried about a possible U.S. default are buying gold and silver hand over fist . The Chinese rush to Gold alarmed by the fear of the U.S. default , Gold is The traditional safe by excellence in times of uncertainty in the currency markets, with the extreme volatility of bank stocks and the fear of sovereign debt defaults (those whose bonds were issued by domestic banks are likely to become toilet paper, what the rating agencies often classify - wrongly - with the name junk) , a true 'gold fever broke among the Chinese investors, with a surge in sales of bullion coins by more than 120% in the first quarter of 2011 on an annual basis. A trend that has pushed up the prices of the yellow metal over the threshold of $ 1,600 an ounce. To drive the demand of the market towards the safe haven par excellence is also the debt crisis of the euro area and the situation far from rosy in the U.S., where the Congress has not yet reached an agreement on raising the debt ceiling with the risk of debt default for the country.

This is why China is focusing on gold. For some time China was a net seller of gold , as well as being a major producer. According to the World Gold Council (WGC), together with India, the country where the demand for gold recorded the strongest growth rates globally. The demand in China is extremely strong, and one of the main factors that drive the market's fears is the rising inflation. Data in hand, in the first three months of 2011 the demand for gold coins and ingots in China amounted to 90.9 tons, an increase of 123% compared to 40.7 tons in the same period last year. In India, sales stood at 85.6 tons. Globally, in 2010 the demand for bullion coins stood under 1,200 tons. According to analysts, the 'gold rush of the Chinese market is a new phenomenon. "Only a few years ago, the Chinese would not have bothered to buy gold bars and coins. But now people will buy them, instead of jewels, as they have a higher value over time . For the Chinese to buy gold is a kind of insurance, they feel they have made a safe investment. Currently, the gold reserves amount to only 1, 6% of the total assets of China, but analysts view it is possible that the Bank of China starts to buy more gold. Especially given the uncertainty related to yields on the US Treasury bonds issued by the Fed, on which China has invested for years because it was believed to be the best way to "park" the money arising from the huge surpluses of their trade balance.

China and India demand for gold and silver soaring

China and India are the largest silver marketplaces globally.Demand for gold from India , the world's largest buyer of the precious metal is projected to exceed 1,200 metric tons by 2020, according to the World Gold Council .In 2009, China bought more gold than India, making it the world's top consumer. China pipped South Africa in 2007 as the world's largest gold producer .Chinese demand for silver has quadrupled in 2010 .In 2010, China imported an unprecedented 14 percent of global silver as the demand for silver has been growing in the country. Till last year, China has been historically been a net exporter of silver. China is the largest gold producer but requires so much of the precious metal (in addition to what it already mines) that it imported more than 209 tonnes during the first 10 months of 2010.Since 2003, Beijing has been buying most of the gold excavated and refined locally.Today, China has more than 1,000 tonnes in its official vaults, up 75% in six years. Its gold reserves are now the fifth-largest among national central banks after the US, Germany, France and Italy.Most of the 1.3 billion people in China only began to acquire and own gold in 2003 as gold ownership was banned from 1945 to 2003. The gold market was liberalized in 2003 .The World Gold Council stated that Indian households are presently in possession of more than 18,000 tons of gold, which represents the world's largest stockpile.
Eric Sprott, of Sprott Asset Management, reported having difficulty locating enough silver bullion for his new silver fund said : "Frankly, we are concerned about the illiquidity in the physical silver market. We believe the delays involved in the delivery of physical silver to the Trust highlight the disconnect that exists between the paper and physical markets for silver."
Today the Industrial Silver Demand at 18-year High
The Chinese government is actively encouraging their people to buy physical gold and silver instead of putting their money into real estate.paper silver is not silver, its fiat silver. Properly secured physical silver is real money. Whether its the 90% coins, sterling silverware, or bullion, its all good. silver is becoming rarer than gold, people just don't know it. With its industrial use as a consumed precious metal, it has the potential to surpass gold in value
Gold is not consumed in industry at the same rate silver is because:
1) Silver is better at conducting electricity

2) Silver has a better thermal transfer rate than gold

3) Silver is a better reflector of light than gold.

4) Silver is a better catalyst than gold

Has nothing to do with high price, Gold is a lousy industrial metal. If gold cost less than silver, Silver would still be used in much greater numbers than gold.
. Silver can usually replace gold, gold can not substitute for silver, or it can but causes the product to be inferior.

China buying all the gold she could lay her hands on

NEW YORK (TheStreet) -- George Milling-Stanely, managing director of the World Gold Council, breaks down China's buying patterns and if the country would get on a gold standard
There's been a lot of chatter in the gold community about China and getting on -- gold standard. Currently China Central Bank only has 1054. Tons of gold in its reserves so. Is China actually buying gold They've been buying periodically for a number of years now and every once in awhile they'll tell the world what they have done over previous period for example in 2009. They reported that at about 400 tons of gold to their reserves in the previous six years. We don't know when the next announcement will be coming but that said there a very strong flows of gold going into China right now. And that it -- and number of people in the market who wonder -- the private sector is capable of absorbing political it's flowing into the country nobody knows the answer we'll find out when China is ready to tell.

China dumping worthless FIAT Money for Gold

The Chinese population and government are dumping the worthless paper currencies of the world, which their governments just magic from nowhere, and dumping guilts, and are instead investing in gold. No matter what the price of gold is, one thing is certain, you can't print more of it like Western governments have done to their paper currencies.

Gold Output Up In China

Gold mining in China is up as rises prices support more production.

China Concerns Pull Down Commodities

China Concerns Pull Down Commodities

A Commitment to Transparency

This morning I was listening to NPR's "Wait, Wait, Don't Tell Me," and they mentioned that a cable released by Wikileaks had indicated that China shut down Google because some Chinese official googled himself and found unflattering remarks about his august self. So much for many right-wing frothers' accusation that Wikileaks doesn't and wouldn't publish material that would embarrass Russia or China.

I hadn't heard about this leak, so I did a search and found this blog at Forbes.com whose writer begs to differ. He thinks that the anecdote is "more colorful than it is instructive." He points to the big picture.

Taken together, the cables convey a sophisticated and sobering U.S. understanding of the Chinese leadership: It has no “reform wing,” it operates on a consensus basis, with President Hu Jintao as a “corporate CEO” brokering among various “vested interests,” and with leaders all determined to see their legacies survive succession.

In other words, at the very top the Communist Party of China is exactly what it seems to be to most, a system bent on preserving itself, that captures the men who rise in it, conforming their ambitions to the system’s priorities.

The system’s priority is certainly not to open itself up to critical examination, so that the Chinese people could find out, for example, which leaders have been touched by hints of scandal, which well-connected families are enriching themselves in various industries, or, as one source told a diplomat in one cable, which officials might have profited from ”shady deals behind land transactions.”

I'm sure this (and more) is accurate enough. It just doesn't distinguish China importantly from any other country. The US' reaction to Wikileaks doesn't exactly betoken an eagerness to "open itself up to critical examination," for example. (Speaking of deafness to irony, try Arnaud de Borchgrave: "But hardly a word has been written or spoken about the motives of the WikiLeaks' chief leaker.") And any American "officials [who] might have profited from 'shady deals behind land transactions," I'm sure, would be quite happy to have their malfeasance exposed to the people, because we live in a country under the rule of law, not men. But openness is for them, not for us, right?

A Commitment to Transparency

This morning I was listening to NPR's "Wait, Wait, Don't Tell Me," and they mentioned that a cable released by Wikileaks had indicated that China shut down Google because some Chinese official googled himself and found unflattering remarks about his august self. So much for many right-wing frothers' accusation that Wikileaks doesn't and wouldn't publish material that would embarrass Russia or China.

I hadn't heard about this leak, so I did a search and found this blog at Forbes.com whose writer begs to differ. He thinks that the anecdote is "more colorful than it is instructive." He points to the big picture.

Taken together, the cables convey a sophisticated and sobering U.S. understanding of the Chinese leadership: It has no “reform wing,” it operates on a consensus basis, with President Hu Jintao as a “corporate CEO” brokering among various “vested interests,” and with leaders all determined to see their legacies survive succession.

In other words, at the very top the Communist Party of China is exactly what it seems to be to most, a system bent on preserving itself, that captures the men who rise in it, conforming their ambitions to the system’s priorities.

The system’s priority is certainly not to open itself up to critical examination, so that the Chinese people could find out, for example, which leaders have been touched by hints of scandal, which well-connected families are enriching themselves in various industries, or, as one source told a diplomat in one cable, which officials might have profited from ”shady deals behind land transactions.”

I'm sure this (and more) is accurate enough. It just doesn't distinguish China importantly from any other country. The US' reaction to Wikileaks doesn't exactly betoken an eagerness to "open itself up to critical examination," for example. (Speaking of deafness to irony, try Arnaud de Borchgrave: "But hardly a word has been written or spoken about the motives of the WikiLeaks' chief leaker.") And any American "officials [who] might have profited from 'shady deals behind land transactions," I'm sure, would be quite happy to have their malfeasance exposed to the people, because we live in a country under the rule of law, not men. But openness is for them, not for us, right?

China Goes for Gold

Gold demand will continue to increase as China's central bank supports an expansion of the gold market. Don Dion currently Holds IAU and GDX
Wed 08/04/10 06:00 AM EST -- Don Dion
Stocks in this video: GDXJ | KGC | IAU | GDX

Gold rush in China is pushing the Gold price to all times high

Chinese love GOLD

May 18, 2010 — China is now the number one consumer of Gold , and it is not just consumers , the central bank of china is quietly building up its reserves moving away from Euros and Dollars into hard assets like Gold ...and to meet this demand for gold China is opening new mines every month to the point that China now eclipsed south africa as the gold's first producer , Smart Chinese buying gold and dumping FIAT at rapid rates....

I guess they see currencies are only headed one way...DOWN!