The Bank for International Settlements released another interesting report this week. It is all about Japan’s savings mania and how secularization of debts missed Japan, which is why Japan is still solvent, unlike the US and UK. And Geithner is following Pelosi, going to China to beg and cajole China into becoming a consumer nation. I guess, Hu needs some jesters to come and entertain him. Bet he films all this for his own chuckles, later. And GM is now bankrupt. A terrible milestone we should all fear.
The BIS has lots of interesting studies. They like to use lots of graphs and charts so I like these very, very much. I hope they keep doing this because much hidden information is revealed accidentally this way as we shall see below:
http://www.bis.org/publ/bppdf/bispap46i.pdf
A note on Japanese household debt: international comparison and implications for financial stability1
Shinobu Nakagawa2 and Yosuke Yasui3
1. Overview of household financial balance sheets The average Japanese household has a financial balance sheet that is far more conservative than that of the representative household in other industrialised countries: in the case of Japan, cash and deposits represent half of total financial assets. In contrast, the ratio for US households is only 16%, while Europeans hold about 25-33% of financial assets in these safe and liquid products. Why do Japanese households prefer deposits so much over more risky financial assets? After all, other financial instruments are well developed and heavily traded in Japan, unlike in some other Asian markets. Several reasons could apply, among them:
(1) a representative Japanese household needs a significant down payment to purchase a house and thus would like to avoid investing in risky financial assets such as stocks, (2) most elderly people, who hold a majority of retail deposits in Japan, were educated to believe – and still believe, to some extent – that saving is a virtue and that the indirect finance system works, and (3) there has been no rational reason to invest in risky assets in the deflationary or disinflationary environment that has enveloped the Japanese economy for many years.
Turning to the liability side, Japanese households have a smaller exposure to debt, such as home mortgages and consumer credit, than their Western counterparts. For example, home mortgages in Japan – the single largest component of household debt in Japan, as it is in most other countries – account for 12% of the financial balance sheet (debt plus financial surplus), about half as much as in France and Germany (28%), the United Kingdom (28%) and the United States (23%).
All depressions have this same feature: since banks offer nothing for savings and since investing money destroys it more often than making it grow and if prices are falling, the need to use your capital to ‘grow’ it diminishes. Cash is king. Cash, if it is savings, is ‘capital’. But NOT WORKING CAPITAL. That has to be money that is plowed back into a profitable system that grows due to labor and production values.
During easy lending phases, savers have to scramble to keep up with inflation because lending IS inflation. If a bank needs virtually no capital in order to lend, this means, they view savings as a liability and only if a government, like, say, China, forces them to monetize their lending via 10% or greater holdings of liability/savings, they will lend based on 0% savings, if at all possible. That is, make money out of nothingness.
This, of course, causes inflation. The guys running the global free trade/floating currency system have figured, they must always have inflation, preferably less than 6%, roughly 3% is the ideal. This way, they can make money out of thin air with a fair amount of frequency while not paying savers much money for the privilege of supporting the entire banking system. This system collapsed in Japan. Leaving the savers to their own devices so they keep their money under lock and key and it is not used to fund lending. Not that the Bank of Japan needs them.
Or rather, even as they HOLD yen in HIDING, the Bank of Japan is content since this KEEPS MONEY OUT OF CIRCULATION so the central bank could lend freely with little worry about hyperinflation. In this sense, the money being held is a defacto capitalization of the entire Japanese financial/monetary system.
This Bank of International Settlements report that came out this week is useful for me. It illustrates many important issues and the most important issue is the difference between the WWII allies, Germany and Japan, and the contrast to the Western Allies, the UK and US. France, incidentally, is very much like Germany and Japan.
In the BIS graph below, I made a few alterations so we can see better, how the US and UK have stumbled and fallen. I took the size of the France/Germany 2000 bar for mortgages and moved it over the UK and US year 2000 bars to see if the Germans and French had the same amount outstanding vis a vis their GDP as the US and UK. We see that the UK in 2000 had slightly more debt than the Germans and French. The US, slightly LESS! In contrast, both the UK and US families have far, far more credit card debt than Germany and France. Even more interesting is….Japan has double what Germany and France have! And the percentage of consumer debt is the same as the US and UK since the mortgage level is so much smaller.
We see clearly that between 2000-2006, the UK even more than the US, went much deeper into all sorts of debts. A third again bigger than the 2000 amount! Both the US and UK built up double the Japanese ratios of mortgage debts in just 6 years. Both Germany and France joined Japan in seeing NO growth in the ratios of mortgages vis a vis GDP.
http://www.bis.org/publ/bppdf/bispap46i.pdf
Who was the main character in the drama called “Japan’s lost decade”? As documented in many papers, the answer is the Japanese banking sector, which holds a large quantity of household deposits (in 2006, for example, about USD 7.0 trillion, or 152% of Japanese GDP) on the liability side of its balance sheet. The lower level of securitisation in Japan relative to that in the United Kingdom and the United States (as shown in Graph 2 in the case of mortgages) has meant that Japanese banks have had to hold a larger proportion of loans and securities on their books.
I keep saying, the bankers have tremendous hostility towards savers. Savers are not desirable which is why they think nothing about offering us savers nothing in return for banking with them. ONLY when the government demands some ratio in support of lending, so they grudgingly give out any interest rate rewards. Indeed, they would far rather give out toasters, etc, than reward us for saving. For example, just to keep savers running up monthly credit card deficits, even if you pay this off each month, this is REWARDED with flying miles, gifts and 10% off the price deals because this is NOT a liability. Since it is CREDIT on the card, it is a plus to the bankers. Hard to understand, eh? HAHAHA. This is why the entire banking system is now collapsing.
Look at the above graph! The SECURITIZATION process is far, far more advanced in the US which also saw virtually no regulations of any aspect of the banking or lending systems. On top of this, the passing of the buck, so to speak, from the banks to the capitalized investment side of the ledger was screwy in the extreme since Japan was feeding the investment side via the carry trade! Look at another amazing fact here: France and Germany had an even lower securitization rate than Japan! So, let’s connect this with another statistical fact of 2006: the world’s #1 and #2 export profit centers of the entire planet were Japan and Germany!
This is where all my research pays off. I have kept a very close eye on both nations for a long while. When all the online economists and pundits were focused on China, I was always very intensively interested in Japan and Germany, too. This is hyper-important: the troika, China, Japan and Germany all used the US to securitize their TRADE PROFITS. The US sold massive debts to them. They bought this debt for one reason and one reason only: to turn their trade profits into leverage and have it GROW via debt instruments in the US which we must pay off, monthly. The US public, in turn, reacted to all this buy taking up as much debt as possible and then going bankrupt, like the NYT reporter who lied about his income, as fast as possible.
http://www.bis.org/publ/bppdf/bispap46i.pdf
The lower level of securitisation in Japan relative to that in the United Kingdom and the United States has meant that Japanese banks have had to hold a larger proportion of loans and securities on their books. As long as the demand for corporate loans is sufficient – as it was in the bubble period, for example – this indirect money transmission system works well. However, once a significant portion of booked assets turns sour, as they did beginning around 2000, banks immediately begin to face a deterioration of capital. Banks in Japan are, after all, asset gatherers; in other words, credit risks are eventually concentrated in the Japanese banking system, which has not changed fundamentally in decades.
The Asians collect debts because it can be very profitable. So long as there isn’t inflation at home, this brings money into their pockets from outside and incidentally, gives them tremendous power. We see this all the time. The US irritates them at our own peril. Our need for them to suck up more debt we generate is hyper-important or we get hyper-inflation. Securitisation markets are, in contrast, well developed in the United Kingdom and the United States. UK and US banks are eager to transfer credit risks to a variety of investors in the financial system, including life insurers, pension funds and hedge funds. We basically agree with the view of the International Monetary Fund that the spreading of credit risk through such transfers is an important source of financial stability.
First, the US banks must get rid of their loan portfolios because they have virtually no savings. If they don’t do this, they go out of business. Even when the ratio rate is set at just 1%, it kills them.
Second, the BIS still thinks this is good? After this massive, massive collapse? How insane is this? The Asians are still solvent due to not copying the ‘modern’ system which is obviously, very, very defective!
4. Distribution of household income and net worth We approach the question first through Lorenz curves for Japanese and US household income. Both curves deviate from a perfectly egalitarian 45 degree line, but the extent of the deviation is obviously greater for the United States, where the difference between the highest and lowest income groups is far greater than in Japan. The Gini indices show that income inequality is greater in the United States than in the United Kingdom, France and Germany as well as Japan, where this measure of inequality is the lowest of the five countries.
We turn next to the distribution of net worth (ie, all assets, including homes, minus all liabilities) across family income groups. Net worth is one measure of a family’s ability to absorb financial shocks. The richest income quintile of US households (the fifth quintile) holds 63% of total net worth, and the second richest holds 19% . In contrast, net worth is much more evenly distributed in Japan, mainly because of its progressive tax system.
A lot of people think that low taxes=high wealth for the entire system. Instead, it simply allows the rich to get richer, faster. The need to redistribute wealth is IMPORTANT AS ALL HELL. Why is this? Simple: it actually makes the rich more powerful over time only because their home base is stronger and stronger. The very rich, in countries that have no middle class, live in naked fear. They have to send their children to school in countries where there is more egalitarianism. The US system, since the tax cutting mania, sees the top 1% holding over 60% of all wealth in America. Japan’s wealthy hold half that percentage:
The US is going to China again, desperate to change something, anything. I will note here that the Chinese read all the BIS literature and digest the same lessons I am giving here. They know very well, Japan has one-way trade with the US and uses taxes and other tools to get the populace to NOT consume but to save. So why should China betray its own culture and imitate the two loser nations, the US and UK? They certainly wish to consume but they want this to be internal, not via imports from the US. They do want our raw materials and our commodities of various sorts! They hope to balance it a tad, this way.
Just like Japan and Germany!
U.S. to Urge China to Shop, Not Save – WSJ.com
Treasury Secretary Timothy Geithner heads to Beijing this weekend to urge Chinese leaders to fundamentally alter the export-oriented economy that has created years of trans-Pacific trade tensions. In meetings with Chinese President Hu Jintao and Premier Wen Jiabao, Mr. Geithner is expected to reiterate U.S. support — and gratitude — for the giant stimulus package that China has implemented to combat the global recession.
HAHAHA…bowing and scraping, happy that the Dragon is feeding itself? Feed it Pelosi. Naw, she is all bones. But he is also planning to press Beijing to take drastic measures to turn China’s economy into one that depends heavily on sales to domestic consumers and less on sales to the U.S. and other foreign markets, according to a senior Treasury Department official….
China will do this only if the other G20 nations do this. Specifically, the G7. Of course, it amuses the Chinese to see Geithner crawl on his knees, begging them to do what none of our supposed allies are willing to do! China knows the allies will not pressure China on this for the simple reason, China will force the US to do this to them, too.
“There is certainly discussion about the importance of shifting towards a more balanced, more domestic-demand source of growth for assuring Chinese growth in the future,” the Treasury official said, noting that the Chinese have included that goal in their five-year plan.
HAHAHA. By the way, the US government knows that the Chinese have a secret 5 as well as the post-Madame Mao 50 Year Plan. These secret parts should be obvious to onlookers by now. Not that the US ruling elites can see much of anything.
That will also require, in the U.S. view, allowing China’s currency to move more freely against the dollar. But Mr. Geithner is unlikely to hector Beijing about the yuan very much during this visit.
You know, Hector, after hectoring everyone, was hit with a spear in the chest and then dragged round and round Troy until his father came out to beg for his son’s body for burial. The US has to beg because we threw away one of the few Weapons of Mass Production: tariffs and barriers. The history of these is long and interesting. Few Americans know that before the Federal Reserve and the income tax laws, our entire government was funded by tariffs and barriers! All of it! And ran in the green, too!
It helped our own factory system to develop into the mega-monster of WWII fame! It made ‘Made in America’ a boast and not a rarity! It created General Motors. It made our cities big. It made our nation an empire. Free trade killed our nation and turned it from a creditor nation to a debtor nation. Our rivals don’t need tariffs and they most certainly have many, many barriers to trade still….they benefit from free trade because the US has no BARRIERS and tax the workers to pay for our entire empire, all of it. Corporate taxes are extremely small and the very rich park their profits offshore!
1894 Income Tax and the Wilson-Gorman Tariff Act: Major Acts of Congress
Prior to the Civil War (1861–1865), America’s revenue needs were met primarily through tariffs, duties, and other consumption taxes. In 1861, however, Congress adopted an income tax aimed at the nation’s most affluent to finance the Civil War. The U.S. Supreme Court upheld the constitutionality of the income tax in Springer v. U.S. (1864). And in 1871, when the need for government revenue declined, Congress repealed the income tax, thereby placing the burden of financing government again almost entirely on tariffs and duties, increasing the cost of goods paid by workers. Thus, the repeal of the income tax shifted a portion of the tax burden away from the affluent to consumers generally.
Many Americans and populist politicians saw the tariff-based tax system as protecting capitalists by immunizing their products from competition from imports.
Many, many text books like the one above, make tariffs look evil! Oh, the horror. Things cost more but we had more workers who got higher and higher wages as they organized to get their share of the profits. And the great middle class began to swell from holding less than 20% of the wealth to over 50%. Now, it has shrunk back down to less than 30% and dropping like a rock.
The stupid income tax started only on the rich and thanks to wars, rapidly climbed the INFLATION ladder that relentlessly moved workers into higher and higher tax brackets until ALL are being taxed…and instead of indexing taxes to inflation, Congress destroyed progressive taxes and kept taxes on everyone! Now, the tax system has collapsed. This last year alone, the government gave me $750 in money we don’t own. All of us got this money. All of which was sucked down by the oil speculators.
GM in Last Lap to Chapter 11 – WSJ.com
The Obama administration plans to usher General Motors Corp. into bankruptcy court Monday and push through a restructuring that will cost taxpayers billions of dollars more than previously envisioned, turning what once was one of the most profitable companies in the world into a government ward. The possibility of a speedy bankruptcy process gained ground Thursday after the government altered the terms of the restructuring and offered GM bondholders a sweetened deal if they would forgive $27 billion in unsecured debt and pledge not to oppose the reorganization in court.
Eventually, people will wake up and figure out why GM was able to become a major corporation in the first place: TARIFFS AND BARRIERS. And why it is now dead. Free trade has already killed nearly all the industries in my small town of Berlin, NY. Yesterday, I passed one former factory that just 15 years ago, used to disgorge over 100 employees at 5pm, saw only three cars leave! The greenhouses just quit, entirely. We have 0 employees there. Our small businesses are folding, one by one, too. Now, after we sat idle while a major city was destroyed in a major hurricane, not to be rebuilt, and the WTC was destroyed and also is not being rebuilt [in this case, thank the gods!]—and we can’t rebuild our industries until we first protect them.
This is a political battle. The last time we had a major candidate who was against free trade was with Ross Perot. Who will talk about the ‘giant sucking sound’ of our jobs vanishing? And are we abandoning Detroit and Flint in Michigan? I think we are abandoning Berlin, NY, too! I don’t like this at all.
Email:
emeinel@fairpoint.net
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Culture of Life News 
Most money managers are only just this week starting to understand this reality. And what kind of horrific situation this is. If Mr. Bernanke steps forward and announces massive new bond purchases, that could disintegrate the USdollar and send gold to $1200 in weeks or even days. On the other hand, if he doesn’t, the primary dealers have no choice but to order a massive liquidation of equity and commodity assets to feed the Gman’s maniacal demand for money. Picture a black hole. Everything is being sucked into it. That is the US govt’s demand for money. This week’s announcement of the $110 billion auction is literally seen by the bond traders as announcing that a real black hole has opened up on a sandy beach. EVERYTHING is slowly being sucked in. Even the sand. And it is accelerating fast in a massive deflationary vortex. As the govt gets the money, it is BURNED. As the sand (and people) pour down the hole, even gold could get sucked in as everything is sold to feed the Gman. Here’s the gold chart, the weekly. The chart looks phenomenal. Indicators almost all right in the middle “sweet spot.” Perfect to activate the head and shoulders.
http://www.greenenergyinvestors.com/index.php?showtopic=6749
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I cant believe this market… the gub’ment blew it bigtime be it terror or terror… who decided we wouldnt liquidate insolvent banks and roll into a new premium… if this is as bad as it sounds its some un-elected FAG BERNANKES OPTION TO HYPERINFLATE OR DEFAULT… what the hell is going on CONGRESS
“secularization of debts”
don’t you mean securitization of debts?
This is such a classic gnome meme:
“We have a problem, now YOU change!” 🙂
OOPS! Freudian slip like when I once wrote ‘Gollum Sachs’ instead of ‘Goldman Sachs.’ Still somehow fits, eh? f:)
Slight correction:
“The US system, since the tax cutting mania, sees the top 1% holding over 60% of all wealth in America. ”
I believe that should be “top quintile.”
“The peak of foreclosures has yet to come,’ Harvard historian Niall Ferguson adds. ‘They will go from 40 percent of all home sales to literally 100 percent by the end of the year.’”
Well, the bankers – as everyone knows – are a lot smarter than we are. They’re probably up to the old trick: borrowing short, lending long. The spread between the long rate and the short rate has never been great. We explained why yesterday. The Chinese don’t trust Tim Geithner to keep his word. For that matter, neither do we. They’ve switched from buying long bonds to buying short bills. So, the bankers – including those working for the FHA – can borrow very cheaply in the short-term market. And they can make cheap mortgage loans, long-term. And then, when the short rates go up…and they need to roll over their short-term loans…they can get in line at the courthouse, behind GM and the parts manufacturers…
…and pick out a gaudy casket too.
http://tinyurl.com/kq6u8q
Nah,
I understand the vortex you explain. The money for the government funding has got to come from somewhere. Each place that it turns, the government runs into walls that are solid and closing in. These times are treacherous. Are we too far down this road to stop? I feel we absolutely MUST while we still have our country intact.
From Telegraph UK (why don’t we see reporting like this is the U.S.?), “Bond markets defy Fed as Treasury yields spike”
So the bottom quintile of the population, is virtually enslaved.
Brilliant Elaine! Spot on. That flushing sound needs to be heard in the bank accounts of the thugs who brought this on. Wishful thinking, eh?
Elaine, I think you should devote a post to discussing the following idea: We simply default on our foreign debts and stop all imports. That would force us to start manufacturing all goods ourselves. Instead of financial and other services, people would start producing the goods China is making now. GM and Chrysler would come out of bankruptcy and thrive as foreign car imports would disappear leaving the market to the big three.
The US economy is capable of supporting itself – we do need imports nor do we need exports. For the same reason we do not need foreign holdings of our Dollars. We should abandon globalization and become again a closed national economy. The growth rate would be smaller, but at least we would full employment and no foreign debts.
Why is nobody discussing this idea?
ΩΩΩΩΩΩΩΩΩΩΩΩΩΩ
ELAINE; We import much of our oil and other energy stuff. Kiss the car culture goodbye. I think, in the long run, that would be good. But it is political suicide right now.
Elaine said:
“The last time we had a major candidate who was against free trade was with Ross Perot.”
The US is so far in debt now ($63 – $68 trillion and not counting derivatives), only a miracle could save it. The U.S. dollar is going to fall even more through 2009 and China already owns you.
Bill Clinton started it all when he signed the NAFTA agreement and it’s been going downhill ever since.
Ross Perot had it right when he said NAFTA would ruin the US and your manufacturing base. People should have listened to him. But, it’s all over now. I think he was hushed by the ruling elite. One day he was there and the next, he was literally gone. I liked him.
The next step is Owe-bama’s socialist agenda and then we will become the North America Union where they will merge the USA, Canada, and Mexico together, just like the European Union, and that’s not a good thing, either. It’ll mean that the poor Mexicans will become poorer and Canadians will become present day Mexicans when the two are forced to absorb US debt through amalgamation.
The joining of Mexico and Canada to the US will be via a currency change, the Amero. This business is very murky but since it is right up the Euro alley and is a favored business by the Bilderberg gang who spawned the euro business…it will happen this way.
“Free” trade has always been a big fat LIE. It has always been about corporate profits first and if the proverbial sh#t hits the fan, just dump the mess onto the taxpayer–and bail. I find it interesting to note how quickly other countries IMMEDIATELY threaten retaliation if the US even thinks of imposing any kind of tariffs and/or restrictions on foreign imports. No diplomatic measures, straight to ultimatums. Actually, the US ruling class also KNOWS how bad “Free” trade is to an economy, but the elites have this deep, bitter hatred of Labor and Unions in particular. So who will speak up for the taxpayer, the ‘average’ Joe/Jane? The Republicans ARE the US Chamber of Commerce–along with the Business Roundtable. And the Democrats are more than willing to whore themselves for money as well. It was Clinton and Gore who rammed NAFTA through and into “law”. Gore lied and lied and lied some more about the “wonders” of NAFTA. I can remember, during one debate with Perot, Gore said he had seen 23 “studies” on NAFTA and 22 of them “proved” that NAFTA was going to be fabulous for everybody. HAHAHA. The joke’s on us. The Democrats made the cynical calculation that they could “screw” their Labor support because Organized Labor sure as hell wasn’t going to vote Republican. I hope Hillary Clinton enjoys her seat on the BOD of WalMart. This ponts out the need for the voter to have the ability to throw the bums of both parties out. To do this, the voter needs a third and even a fourth OR even a fifth party to choose from. Clearly, the Repugs and Dems are incurable. Term limits and campaign finance reform are needed as well. The voters must make these reforms happen; the two parties currently in power are NOT going to voluntarily give up their advantages. The voters are going to have to MAKE them change. And with the Repug party dying, this could be a genuine opportunity for major reform.
It can’t be the Democrats: they are in power right now. The GOP is going straight off the cliff, it is still focused on rousing anti-gay/abortion hate fests rather than deal with this mess which they created, too, anyway.
Dialectical Materialism Haiku
lending IS inflation
Weapons of Mass Production
are tariffs and barriers
Hey, that’s great, Joseppi! Now, if someone can translate it into Japanese…. 🙂
Another great piece, EMS. I recall Pat Buchanan is an avocate of tariffs and barriers, but his political moves were scuttled by the anti-semitic label. It seems usury and free trade go hand in hand to subvert the US Constitution and divert all wealth to the international elites who have effectively taken control of politics, finance, and academics with their unlimited credit lines to buy and/or destroy American business and political movements. I appreciate your tracing the elites power to the central bank system and BIS, the head of the monster with the power to creat the unlimited credit lines from which orginate all other manifestations of power.
Most Americans never look behind the curtain in this way. History is certainly not an accident, but the conspiracy of a hidden elite. Now, at this late date some are beginning to engage the power of human reason and the internet to shine a light on the nature of economics and politics. Economists tell the lies and politicians hold a gun to our head.
Thanks for the great education you present on these pages, EMS.
@BFT: Actually it started under Reagan, when his administration got the Saudis to lower the price of oil in order to put pressure on the Soviets, who were oil exporters at the time, so they had to produce more — and bring Soviet domestic peak oil sooner. Of course, that worked like a charm and the Soviet Union is no longer with us.
His administration also cut a deal for auto “quotas” with Japan and pull the wool over the eyes of Congress so that they would not erect tarrifs and barriers against Japan’s cars. That worked like a charm, too; Reagan got millions for giving a speach to the Japs after he served out his term– 🙂 — and in 92 Poppybush went begging to the Japs and puked on the Jap PM’s shoes!!! 😆 😆 😆
@Paul S: every attempt to neutralize the GOP/DNC duopolist hold on power has met with resistance from the state legislatures to repeal laws that rigged voter registration in favor of the two parties, skepticism from the US Federal Courts to lawsuits challenging the constitutionality of those laws, and WORST OF ALL, scorn from the corporate media who herded all voters into a choice between two evils because, they, the media, profit from the two-party duopoly.
The media mocks anyone who dares to upset the apple cart.
Dialectical Materialism
Ah, communism 🙂
Ed-M: Of course the GOP/DNC will fight changing the balance of power. Both parties have a cynical self-serving interest in the status quo; of course they won’t change on their own. Chnage will have to be forced. The first step is to get the ‘sheeple’ to get out and DO something about this. Change will take persistence. Like the Chinese say, even the longest journey begins with the first step.
You know I think I said along time ago on this site that GM is heading for the pit. I know I said it to my brother. Several years ago. I suppose could of put my supposition to the bet, but I had no desire for profit. Unlike GM. GM destroyed mass transit, and now GM is fixing to be bankrupt.
Seems simple to me.
Peace,
Ken
I should have said “GM thought they would replace mass transit with an individual car, and GM took deliberate action to make this so. But, GM was wrong, mass transit simply makes sense and so try as they will GM was destined to failure because GM was usurped by profitable desire. GM didn’t understand profit. GM is heading toward bankruptcy. I said it a long time ago!
Peace
2 June 2009
“India: Hyundai Motors victimizes workers”…
http://tinyurl.com/nuul7t
It could well turn out to be that using third world labour will not be any cheaper then making things in the USA/UK.How long and how much more suffering though?.There again the skill base has been so badly damaged over the last 30 years…It just goes on and on.