I think that picture is distorted by your use of US dollars as measure of value. If you use Euro or better barrels of oil as y axis, you will observe interesting things. The EU increased imports, but in Euro not as much as in dollars.

Also - your great Chinese reserves graphs, try to plot them in oil barrels or grain bushels, or even in Euro. The Chinese reserves in real purchasing power are not doing that great recently, isn’t it? The question is: does China policymakers care and if yes, what will they do?

P.S. apologies for crude English.

I think that picture is distorted by your use of US dollars as measure of value. If you use Euro or better barrels of oil as y axis, you will observe interesting things. The EU increased imports, but in Euro not as much as in dollars.

Also - your great Chinese reserves graphs, try to plot them in oil barrels or grain bushels, or even in Euro. The Chinese reserves in real purchasing power are not doing that great recently, isn’t it? The question is does China policymakers care and if yes what will they do?

P.S. apologies for crude English.

Brad, be careful what you wish for, in the "globalized"/interdependent world we live in, a slowdown in China might not just provide the relief the US is in need of but a sting in the tail in the recovery phase that the US would need to go through soon. For one, some investors may have a nasty surprise should they find the need to pull out of a slowing Chinese economy, it’s an economy that’s trickier to get out of than into. "Being too invested" might just be a new concept that investors have to learn, ditto for India.

The rest will continue saving … as usual.

I have lost the believe the US is capable of saving … the dollar keeps falling and the deficit just widens. This will go in the history books as the conundrum of the late 20th century.

So it s just a matter of months now till the crisis hits china. It ll pay dearly its mercantilist policies…

Econ 101: no matter China & India are dropping 1 million engineers a month. These engineers like everyone else enter both the supply and demand functions in a market economy. They produce chips or whatever and will drink pepsi and catch a movie I don’t know. All that matters is that that complicated stuff they do is getting cheaper and the moronic pepsi more expensive in relative terms.

Yeah well I’ve worked for a bunch of those clowns and guess what, it is always one of US state university guys from the real world who either ends up cleaning up their mess while they continue to collect a fat paycheck or we end up on unemployment as a result.

Ivy League = Lots of silly stupid ideas about how to run the world.

A. “What can CN, India produce for us, what we can’t produce for ourselves?”

Nothing. Except:

- in middle-term: some highly sophisticated products:

- in long-term: some products of almost-genies (example: Th. Hänsch’s "frequency comb synthesiser"; http://en.wikipedia.org/wiki/Theodor_W._H%C3%A4nsch)

(and except maybe bamboos?)

But they will produce all the rest now and the more sophisticated products tomorrow; because they can it, will it and do it:

- much more deeper cost, wages, social security, environment-problems, ..;

- how many 100’000’s of engineers leave all year the universities;

- (ff) assiduous, capitalismus oriented and apparently more patriotic than US-‘citizens’ young humans.

And they can do it for a very long (10/15y?) time; depends on a lot of things: for example: what kind of unemployment/poverty is the US/EU prepared to bear?)

B. “Specialisation improves productivity, ..”

I think, CN-capitalismo-burocratico-militario-politico Elitemen are pragmatic men (as the Indian-leaders), the old history/experience will show some signs, minimally.

That means: everything that is, for them it is just a tool -in the hands of the winner; that means: DOGMAS of any economy-‘theory’ (and specially when it comes from the West)are just a tool, as is also any religion ore other ideology ore illusions-fantastico-politico ore in general: other performances of the successors of the scholar of any Oracle of Delphi (http://en.wikipedia.org/wiki/Delphic_Sibyl).

In short: if the dogma of “comparative advantage” (Riccardo; has come to economic-theory during a period of illness; a not much discussed fact) will be adequate, then the CN-Elite will use it; if not, then not.

I think: the Dogmas belong to tititainment (Brzezinski) for the Big Game.

C. ff “…so it will not make sense for CN/India to produce everything on their own, unless they have an explicit goal to be independent of others.”

The CN goal is, to organise work for 1.4 bn humans; food and stability/tititainment and ‘security’. The best tool will be what?

(I belive CN will become big social problems: rich/poor, city/countryside; eventually ethnic problems (Moslem (Uygur, Kazakh,Kirghiz) , Tibet, Mongolian): http://www.lib.utexas.edu/maps/middle_east_and_asia/china_ethnolinguistic_83.jpg ore http://www.lib.utexas.edu/maps/middle_east_and_asia/china_ling_90.jpg

These and other problems gives the CN-Elite enough drive, to not sleep, but produce the reality, that is as near to their goal as possible.

I don’t believe, that CN want to be autarky/independent. See their export/import volumes. They know, that they are, what they are, because of the global environment: commodity import/US,EU,Rest for export; No Great Wall: otherwise they all will become farmers and have a life in bamboos-houses and look at the moon and goes the incredibly hard way: do it yourself. But this is completely unrealistic.

Next it is evident, that the US/NATO, EU, RU, IN will use the divergent/separatist powers in CN, when they think, it would be nice.

(But because the voices of the global citizens are in a condition of total deplorability, the story will take that way, that Luzy Homo (sorry, no better photograph http://en.wikipedia.org/wiki/Australopithecus_afarensisl ore http://www.modernhumanorigins.net/al444-2.html

invented (besides: before that time was the Era of Golden Time, the Fool’s Paradise. (this should be ironic - for the broken English speaking spectators.-))

D. “…. But temporarily mercantilism was an option as well for France in the 18th, …..

Yes. As I said: Everything is only (and nothing else) a tool of power in the power game of the different (national organised ore in fat companies) globally effective Super-Players. And Everything has its time and has not its time as a tool.

A structure, that we see: different ‘attitudes towards the world’ in the following sense: vita passiva and vita activa:

- as a pharmacist: you create a family, a company, your environment ..; for the rest you are passive, consumer (of physical and mental supply).

- as a leader of a country (take CN), the active part is incredibly high: you create a lot of things, huge things. You can not consume given stuff, you have to create real stuff, have to design the actual and the future reality (bring in reality, fact): war/peace, development/standstill, … of millions and billions of people. (the question: this stuff, do they do under control of the society/citizen - or do they do this by their own feeling/good-thinking ore god-thinking, ore ..)

These are two different games: it should be forbidden to believe, that the game of the Big Leaders has anything in common with the normal-human game; like Christoph Columbus: one went in unknown territory, the others stood at home.

globumedes