Exports help the country and imports harm the country. China will get rich because it produces and exports everything. Or is it a little different?
Take the article with a clear view, it is a simplistic comparison.
China is afraid of a lot of people. However, according to a recent survey, investors expect it to be in "several" years of crisis. To understand these great contexts about a large state, we need to look at the issue of imports and exports and everything related to it. A parallel came to China. However, the truth is that Martin Pánek gave me the basis for that parallel.
Household trade balance
Imagine yourself in your own apartment. Some have to try their imagination, some don't (lucky). When you go to work, you export your labor and human capital from your territory. When you leave work, you import money (capital). People usually work for a fixed salary. It doesn't matter how the salary is set - you always have to spend some time working. Someone is willing to pay you for that time. So your work is somehow valued - you are exporting work at a price. More precisely: you balance the time in hours for the price of 100 crowns. You export an hour, you import a hundred.
There are a lot of people among us who say that we need to support exports. Among them is a group of people who say that the currency needs to be "cheaper" in order to export as much as possible.
It's an interesting consideration. In our example, it would look like this: you obviously want to work harder. That is why you will reduce your price of work - you will come to your employer and offer him to work for 50 crowns in one hour. At first, your boss will think you're crazy. Subsequently, he seizes the opportunity and nods with pleasure to your offer. It will start to keep you busy. You balance more work, more hours. However, you import less every hour. To get the same thing as before, you have to work harder. People usually don't like that.
Suddenly you find that you import little even for 50 CZK / hour. You decide to take a radical step: you give away your work for free (almost). You will reduce your salary to CZK 1 / hour!
The effect is almost instantaneous - work you have it over your head, you run here and there, you hardly interfere with your home. To earn what you used to have, you have to work days and nights. But you don't mind. You are satisfied! Above all, you want to export, because that's right!
Such people are called "workaholics." However, the initial enthusiasm for work is eventually replaced by collapse and some time inability to work.
China was such a global workaholic. With its "undervalued Yuan," it did not harm the United States (as Barack Obama claimed), but rather to himself.
She's out of breath, like any real workaholic. At home, she is beginning to suffer from inflation, she is building dead cities for no one (and she has no time to complete them), small investments are spreading. The Chinese century may come, but it won't start now. It will start only after the crisis that awaits China.
So what made China so rich? It was not because of exports, as one might think, but because of imports. What makes students smarter? Because they go to school, or because they gain knowledge at that school? Everyone can go to school - some suffer the time, some study. He who "suffers" does not import anything - he is not educated. It can then be expected that the student who is actually learning will be smarter.
What preceded China's growth was opening up to the world. China first allowed imports into the country. As a result, she became rich. Technology, factories, production, knowledge were imported to China. Thanks to that, he has something to export for.
What will make you richer? That you go to work day and night, or that you bring a lot of money from that work?
In the US, it is now apparently trying to cut the price of the USD. This is evidenced by their monetary policy. President Obama says how "maintaining growth" is his mandate. Sorry, Mr. President, this is not your mandate. The only thing the Fed will achieve with its policy in the US is slightly higher inflation and the foundation for further bubbles and crises.
Artificially reducing the price of factors of production by state power is always counterproductive. Austrian business cycle theory can be grafted not only on money and capital, but also on other factors of production.