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Globalization dead?


Dottles
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I've read some reports that some financial 'experts' have stated that when the war w/ Ukraine settles -- that Russia has gone East and not West and the world is split again into China/Russia/India and the West (including Europe) while other experts think the dollar will just be devalued and the new non-SWIFT banking (China) will be valued.  The Saudis are already considering using the Juan as the basis of trade and reserve currency?  What do you think?  I mean barring WWIII -- how's this going to play out?  Can we just come to expect higher inflation, a lower dollar value, a weaker economy out West or is there an upside?

 

https://www.reuters.com/business/ukraine-war-could-spur-creation-new-china-led-trade-bloc-2022-03-17/

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2 minutes ago, Philander Seabury said:

Predicting is hard, especially of the future. 

Spoken in un accented Stenhalise, that's “'It's tough to make predictions, especially about the future'” 

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5 hours ago, Dottles said:

other experts think the dollar will just be devalued      how's this going to play out?      

We will know soon enough....   

Just hope the bill for the national debt doesn't need to be paid to the new landlord anytime soon.    A 30 trillion dollar bill would be kind of difficult to pay with even the dollars we don't have now.

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1 hour ago, Bikeguy said:

We will know soon enough....   

Just hope the bill for the national debt doesn't need to be paid to the new landlord anytime soon.    A 30 trillion dollar bill would be kind of difficult to pay with even the dollars we don't have now.

Yep.

 

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...nobody in his right mind is gonna start making bicycles or component groups in the United States again.

Generally, war is only good for certain business sectors.  So those guys will do OK.  Everyone else will run their cars longer before they buy new ones.

 

^^^three predictions in the space of two lines on the internet.^^^

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7 hours ago, Page Turner said:

...nobody in his right mind is gonna start making bicycles or component groups in the United States again.

Frames? That's an industry that has grown in the US for a decade or more.  Components? Yeah, for sure the full gruppos are a hard sell as Shimano and SRAM dominate is sales, but the random upgrades - larger pulleys or a special chainring (like the oval ones) can be made in the US.  Enve or Wolf Tooth or many many others. But since you can't easily make a "bike" without all the parts - including each component in a groupset, it is always tough to make anything but a fully "one country" bike except maybe a Taiwanese one or a Chinese one or a bespoke Italian one.

16 hours ago, Dottles said:

Can we just come to expect higher inflation, a lower dollar value, a weaker economy out West or is there an upside?

That wouldn't be the end of "globalization" as much as the shift of the center of it.  I imagine the Brits were stunned to lose their center of the world status, but that's just life. :(

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18 hours ago, Dottles said:

I've read some reports that some financial 'experts' have stated that when the war w/ Ukraine settles -- that Russia has gone East and not West and the world is split again into China/Russia/India and the West (including Europe) while other experts think the dollar will just be devalued and the new non-SWIFT banking (China) will be valued.  The Saudis are already considering using the Juan as the basis of trade and reserve currency?  What do you think?  I mean barring WWIII -- how's this going to play out?  Can we just come to expect higher inflation, a lower dollar value, a weaker economy out West or is there an upside?

 

https://www.reuters.com/business/ukraine-war-could-spur-creation-new-china-led-trade-bloc-2022-03-17/

If China loses trade with the USA and Europe, the Yuan will crash in value.

Note that the median household income in China is $10,220 - in the cities vs $84,300 in the USA.  It's about $3,000 in India and $6,500 in Russia.

In the rural areas, families still have a government provided ox to do the plowing in China.  It does not have the financial resources to do well without trade with the West.

In Western Europe it's about 85% of USA income.

If we go back to a cold war, everybody loses but it with crush standards of living in China, India, and Russia.

P.S.  Here's a map/table I found:

image.thumb.png.8d0876bced1e846f2062fd543dfaae7b.png

image.png.9e855f47472fe5be4399215e28d67678.png

image.png.90bcf3a282332d16f690a0c273123229.png

 

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52 minutes ago, Dirtyhip said:

Median income in the US is 84K? That sounds high. I guess it depends on who did the study.  

"Household" - ie often 2 earners - but also unlikely to hit $84k unless it really jumped in 2021?  But it is a valid point - selling high value/high profit to "wealthy" countries vs "high volume/low value/low profit" items to poor countries is a clear incentive to China and others to choose the former.

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4 hours ago, Razors Edge said:

Frames? That's an industry that has grown in the US for a decade or more.  Components? Yeah, for sure the full gruppos are a hard sell as Shimano and SRAM dominate is sales, but the random upgrades - larger pulleys or a special chainring (like the oval ones) can be made in the US.  Enve or Wolf Tooth or many many others. But since you can't easily make a "bike" without all the parts - including each component in a groupset, it is always tough to make anything but a fully "one country" bike except maybe a Taiwanese one or a Chinese one or a bespoke Italian one.

That wouldn't be the end of "globalization" as much as the shift of the center of it.  I imagine the Brits were stunned to lose their center of the world status, but that's just life. :(

What percentage of frames (probably under 5%) can the us provide with all of this growth?

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16 minutes ago, maddmaxx said:

What percentage of frames (probably under 5%) can the us provide with all of this growth?

???

Why would that matter?  If YOU want to make a decent (or good or great) living, you can follow the example of MANY Americans (and Canadians) and become a frame maker.  Plenty have done it. Plenty have made livings doing it. 

Does the future of the US economy rest on the shoulders of cycling????  Jeebus, we're screwed!

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1 hour ago, Razors Edge said:

???

Why would that matter?  If YOU want to make a decent (or good or great) living, you can follow the example of MANY Americans (and Canadians) and become a frame maker.  Plenty have done it. Plenty have made livings doing it. 

Does the future of the US economy rest on the shoulders of cycling????  Jeebus, we're screwed!

It's a small shop business.  There are Chinese factories that turn out more frames in a day then some of our frame companies do in a year.

 

Sure, let's just move it all back to America.  Easy words.  Tough actions.  I believe Page is correct, no idiot would willingly try to do that.

I mean that in the nicest way of course.

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9 minutes ago, Razors Edge said:

Yeah, the idiots will sit it out.  The smart ones get it done.  :dontknow:

Why, economically and logistically would the bicycle factories move away from where most of the end product is used?

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10 minutes ago, maddmaxx said:

Why, economically and logistically would the bicycle factories move away from where most of the end product is used?

In your mind the only folks building bikes are using factories?  Okay.  You win with that logic.  :dontknow:

I'll tell my buddy to return his Sachs as he must have been riding a "phantom" all these years. And someone has to break the news to @Old No. 7 that his Seven is a figment of his imagination. 

And @ChrisL might check on his Ritchey.

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1 hour ago, Razors Edge said:

???

Why would that matter?  If YOU want to make a decent (or good or great) living, you can follow the example of MANY Americans (and Canadians) and become a frame maker.  Plenty have done it. Plenty have made livings doing it. 

 

...I have followed the custom steel/titanium frame building marketplace in America for over 40 years.  I have attended the NAHBS show here, when held in Sacramento, at least three times. I have spoken with, and visited at least three of the local frame making guys here (Steve Rex, Bernie Mikkelsen in Alameda, and one guy (Whit) who only lasted a few years before he moved somewhere else, whose wife had a job that mostly supported them.

There are very few custom frame makers remaining here.  The ones who managed to build up a following, like Steve Rex and Bernie MIkkelsen did not make oodles of money doing it. Steve is essentially retired from the work, although he will still take an order for a full bike. Bernie has had a serious stroke, and he's only getting by in Alameda with significant assistance from his wife, who has always run the business end of it, and now acts like another set of hands in anything requiring more than a simple clamp and braze.  It's a huge space, and I don't know how they manage to still make the rent, given the amount of repair business he gets.

There was a guy in Petaluma who decided to shut down four or five years back, and wanted to sell the business (he had a lot off nice machinery for fitting and chamfering frame tubing). No takers.  He had to basically have a giant in place yard sale, and watch all the tools and machinery go out piecemeal, at bargain prices.

KImo Tanaka, the "Innerlight" frames guy out in Davis, just rolled up his tent and disappeared.  The one shop out in Winters who used to take orders for him and handle sales doesn't know how to reach him.

You have a strange view of this industry, and there is a very good reason it has not seen a huge influx of younger apprentices taking over the operations of the guys who are aging out now, like Richard Sachs and Tom Kellogg ("Spectrum"). I have one of the frames by MIchael Johnson, who built very few of them before he decided he could make a better living doing something else.  Also one of the old customs by Boone McReynolds ("Diablo Cycles"), who only made about 400 or so of them before he moved to Oregon to repair sewing machines for a living.

I'm left with a very different  impression, and the reason is because I actually tried to make a living for a few years in one of the handcrafted metalwork marketplace.

 

There's only one of you, there's usually not enough profit margin to hire much in the way of help, and your production is necessarily limited, compared to a factory environment.

 

The question was about globalization, not whether the future of America is dependent on domestic bicycle manufacture. It's simply an example of how American factory production of small, useful, stuff has gone by the wayside, because it's cheaper and more efficient to make it in Asia or maybe Mexico.

You are just a youngster, but I still remember working on Bendix coaster brake hubs that were proudly turned out in substantial numbers right here in America.

*cue the national anthem*....*gradual fade to black*

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4 minutes ago, Page Turner said:

The question was about globalization, not whether the future of America is dependent on domestic bicycle manufacture. It's simply an example of how American factory production of small, useful, stuff has gone by the wayside, because it's cheaper and more efficient to make it in Asia or maybe Mexico.

You are just a youngster, but I still remember working on Bendix coaster brake hubs that were proudly turned out in substantial numbers right here in America.

From reading your post, it seems globalization is doing VERY well, so I guess it isn't dead after all (my comment towards the top).

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23 minutes ago, Razors Edge said:

Yeah, the idiots will sit it out.  The smart ones get it done.  :dontknow:

 

5 minutes ago, Razors Edge said:

In your mind the only folks building bikes are using factories?  Okay.  You win with that logic.  :dontknow:

I'll tell my buddy to return his Sachs as he must have been riding a "phantom" all these years. And someone has to break the news to @Old No. 7 that his Seven is a figment of his imagination. 

...do you honestly believe that Richard Sachs would not have continued in some capacity making bicycles (using apprentices or hired help), had the business been lucrative enough to warrant it ?  Everyone who makes (made) frames did not have a four year waiting list.  You can thank your fucking Di2 plastic sonder bike for that.  Those babies sucked all the cash out of the marketplace.  The guys spending $10,000 bucks on a two wheeled ride are now buying them from Spesh, and they come out of molds in Asia.

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9 minutes ago, Razors Edge said:

In your mind the only folks building bikes are using factories?  Okay.  You win with that logic.  :dontknow:

I'll tell my buddy to return his Sachs as he must have been riding a "phantom" all these years. And someone has to break the news to @Old No. 7 that his Seven is a figment of his imagination. 

And @ChrisL might check on his Ritchey.

You're correct.  Not all use factories.  You can wait a few years for your bike as the production level isn't even large enough to support a single large lgs.

No point in further discussion.  Reality nonexistent.

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