Long the land of low low prices, the prices on consumer goods imported from China could rise by as much as 10 percent this year. What’s changed in China?
Uhoh, WallyWorld is going to be pissed.
China’s Inflation Hits American Price Tags [NYT]
(Photo: DCvision2006)
Good – if things cost more people won’t buy as much useless shit.
What is the connection between the yen and China? (And no, the yen is not “worth more than the dollar — not by a long shot, since it’s still around 100 yen to the dollar. it’s just worth more than it used to be.)
I think this is an adjustment long overdue. What sucks, though, is that most people won’t step back and evaluate what they really need. They’ll just whine to the government and/or the media about how they can no longer afford the lifestyle to which they’ve become accustomed.
china’s labor laws have a long way to go, but i see this as a positive for workers there. i hope it inspires people to buy american… at least until we find another developing country to manufacture our plastic crap for pennies.
I think he means “yuan” not “yen”. “Yuan” is pronounced “yoo-en” so it sounds very similar to “yen”.
Also, 2 years ago 1 US dollar was 8 yuan. Now it is 7.2 yuan. The Chinese government does not float the yuan like most other countries do to their own currency. One of the effects of buying so many US treasury notes is that it allows them to keep the exchange rate of the yuan artificially low, allowing their exports to be cheaper than they would be otherwise.
We’ve been bitching that China undervalues the Yuan against the dollar, and now there’s going to be bitching that the cost of imports will go up because it’s finally starting to adjust to the rate it should have been all along. What the hell man.
Can’t we just rectify this situation simply by adding lead to everything? Lead’s cheap.
I’ve been telling people for years that this would happen. Once we pump enough money into China, the tide of cheap crap will end. So who will make all our crap in the 2010s? The per-capita income of India and Vietnam are less than half of China and they’ve got an extensive infrastructure in place, so my bets are on them.
I’ve often wondered why capitalism just doesn’t root out the most dirt-poor port country, like Liberia, and put factories there, but I guess when you add up ten years of wages anyplace, it’s a drop in the bucket compared to the cost of construction and infrastructure.
@homerjay: But it’s heavier and costs more to ship
That’s really going to cause problems for a lot of stores here because they are going to have to change all of their signage…
The Dollar Ten store
Dollar Ten Tree
Everything’s a Buck Ten
Dollar Ten General
@rbb: You forgot the Family Dollar Ten!
Haha, sucks to be china when Walmart tells them to lower their prices or they’ll be dropped as a supplier. I guess with fuel costs, it’ll soon be infinitely cheaper to manufacture things locally.
@timmus: We could make our own crap. Part of the reason that we don’t, is that it’s expensive to hire Americans, even one’s self.
“Good – if things cost more people won’t buy as much useless shit.”
WORD!
How many cheap plastic chotchkes do we need, anyways??
Smart work from China. It’s all downhill from here.
Where are all the China naysayers now? This blog is full of commenters who have succumbed to American media’s fear-mongering about China and have no clue about the situation over here.
@icruise: Yuan (or RMB) is China’s currency. And no, it’s not 100 to 1 it’s 7.2 å…ƒ to 1 $USD. Which is way up from the 8.16 that had been stabalized in previous years. Since factory wages are not in USD, when you get 12% less goods, it costs 12% more. But know that US companies are already moving their overseas manufacturing to more “favorable” nations, i.e. Vietnam. These jobs ARE NOT coming to America, so stop deluding yourselves.