ZH - Japan isn't quite as bad as it looks. It has been quietly going through a change in the last five years or so and so has Europe. The big change is that forthe first time in nearly 500 years China is reverting toits position as the World's manuacturer.
Every week Japanese new reports of various bits and pieces of manufacturing moving to China. The Rmb is probably undervalued but it won't get revalued.
Same sort of thing happening in Europe. Manufacturing moving to China.
The magnitude of this change which is if anything increasing has never been seen in history.
The basics forces of ecoomics are being unleashed. Profit can only be made if you have somethning that others want to pay for and they have to have something of value to give in exchange.
The Chinese therefore make things so much cheaper than anyone else that you have to go there to get your goods made,then you can bring them home and sell them at a profit because you are in effect arbitraging the cost of labor, health, environment legislation etc.
So it used to be for Japan after the War for thrity years. But there is a difference, the Japanses are for some reason not very inventive and not very good gamblers. The Chinese on the other hand are very inventive and gambling is every day way of life. Consequntly it won't take the Chinese very long to become both a source of labor and a source of invention.
Europe on the other hand still has huge restricitve practices, massive social welfare programs etc. There is simply no way now that Europeans continue to live off the fat of land and retire and go on cruises especially with a dwindling population. The Chinese are eating their lunch.
Similar but not quite as aggressive in commerce is India and lets not forget Korea nad Vietnam.
So you now have nearly half the population of the World relatively suddenly devloping at a rate that has never been seen before in history.
The economic centre of gravity of the World is now Honolulu and not Iceland.
So what about the Euro. Well whateveer it does is becoming of less relevance as he Rmb gradually morphs into a major World currency.
How does this affect the market? Well if half the World is going to have a vastly bigger econoomy in say five years from now then that doesn't look to me like it is bad news for the US economy which is so closely connecteed to it.
Best,
L
AI
Market Data 
Markets 
