CHINA WILL BE A BIGGER BUBBLE THAN JAPAN

Superb analysis out of SocGen analysts this morning.  Dylan Grice says the Chinese economy has many similarities to the Japanese economy before it imploded in the 90′s.  He cites 8 reasons why the Chinese economy is likely to be an even larger implosion than the Japanese economy:

Studying the lessons from Japan’s lost decade(s) is key for anyone seeking to understand today’s post-bubble world. But a closer reading of Japan’s financial history illuminates today’s China far more. In the early 1980s, on the eve of its financial liberalisation, Japan was the rising power from the East set to overtake the West. Younger and growing rapidly, it was still a decade away from its climactic and catastrophic bubble peak. This is where China is now.

  • Japan’s deflationary experience since its bubble burst haunts policy makers and investors, who are confronted with a bewildering range of theories explaining what has gone wrong and how a similar scenario can or can’t be avoided.
  • But the real cause of Japan’s deflation is probably more demographic than debt-related.  If so, maybe we should be more worried about the side-effects of an ongoing stimulus overdose aimed at reviving the dead, rather than fighting a more ordinary bout of flu.
  • Japan has been the first industrial economy to begin demographic contraction. Indeed, thanks to Deng Xiaoping’s 1979 one child policy, China will soon face the same problem.
  • But it is unlikely China will suffer the same immediate fate. In fact, further reflection on the similarities between China and Japan leads one to realise that many of the challenges confronting China today have already been faced by Japan, demography being only one.
  • From the strained currency diplomacy to the accusation of favouring exports over domestic demand, from the Western marvelling at Confucian capitalism to the sense of inevitability about the rising of a great power in the East … all were as true for Japan 30 years ago as they are of China today.
  • And Japan 30 or so years ago might be a more fruitful analogy altogether. There is a clear historic coincidence of manias and geopolitical shifts. In the 1980s, Japan’s developing financial bubble reflected a shifting of the balance of power in its direction.
  • But the geopolitical shift towards China now underway dwarfs that seen in Japan in the 1980s, and probably anything yet seen in the history of the modern world. A commensurately seismic mania would lead to excesses beyond all proportion to the periodic bouts of frothiness seen so far.
  • Japan’s experience also hints at what may be the future catalyst unleashing this frenzy: capital account liberalisation. Financial history is filled with financial liberalisations gone wrong and Japan’s bubble can be traced directly to the removal of controls on international capital flows and banking in the early 1980s. Seeking a larger international role for the renminbi, China is now, albeit tentatively, embarking on a similar path. Full liberalisation, when it occurs, could be the starting gun for the biggest bubble the world has ever seen.

socg

Source: SocGen

Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.

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Comments

  1. William,

    Thanks for being a good sport in this debate. At least we agree on one thing – your last statement.

    Although I know your average Chinese citizen has no ill will towards Americans I can assure you that the government is very frustrated with the U.S. as their comments can attest to. The Chinese are in a most unenviable position by being flooded by dollars and having no choice but to purchase U.S. based assets with those dollars. Otherwise, they would be forced to exchange those dollars for domestic currency and effectively risk rampant inflation. It’s a fascinating dynamic really. Trust me, they wish they were not in this position. That is why they are trying to promote domestic spending and attempting to diversify their economy from the export based model. They know they are a position of weakness, but are slowly and surely strengthening that position.

    The American Capitalist system created more millionaires in the last 50 years than any system known to man. Per capita, the successes of the system are nothing short of astounding. There are 4MM millionaires in the U.S. vs just 825K in China. Per capita you can’t even compare the successes of the two systems. The U.S. is simply head and shoulders above.

    The fact that the U.S. market is just 20% off its all-time highs (after the worst recession in 75 years) is negligible in the grand scheme of things. You say the system is destined to fail, but the Chinese are essentially copying the system. Hmmmm.

  2. Sorry TPC, I was not going to make any more comments but can’t help myself.

    The Chinese are getting rid of their US$ by spending them on raw materials, minerals etc that they will use not necessarily use in the immediate future but when the need is there, whenever that may be. Some will be re-exported as finished products, the rest will be consumed domestically.
    The US lead economic downturn has made these items cheaper to buy and when the market does turn around, they will obviously be worth a lot more vs the US$ which will still be spiralling out of control due to inflation caused by prinitng too much paper money. The Chinese have also been building up their gold reserves to hedge against inflation.

    With regards to the numbers of millionaires you quoted, I wonder how many still are after investing with the likes of Maddog Madoff? I guess too, it will be only a question of time before the number of millionaires in China exceeds that of the USA. A couple of years ago, I read that 55,000 Chinese were attaining US$ millionaire status per year, but I am sure this figure will be lower now.

    Yes, China has a long way to go to catch the USA and it is this distance in time and achievement which I think will ensure that there is not a major Bubble like Japan experienced.

    In saying that they (the Chinese) will have to overcome a number of things like:
    1) A Banking system which is like New Zealand was 40 years ago, can you believe they still use rubber chops?
    2) Government corruption where it is who you know and the amount of money that you offer around in envelopes that gets things moving for you.
    3) An education system that teaches students to copy and cheat.
    4) A business system where greed often leads to such stupidity that people lose their lives for one reason or another.
    5) Pollution, although they really are starting to address this.
    And so many more things….

    But, unlike the US Government, the Chinese Government know they have to deliver on their promises to their people. Failure to do so will not just see them voted out, there would be a social revolution that would see them killed and all their ill gotten gains lost. Maybe that would be a good solution for many of the bastards in the USA that have brought about this current crisis?

    Is that Pragmatic enough for all Capitalists, Chinese and American?

  3. William and TPC,

    thanks for the great debate!

    2 points:

    1. will the Party be able to produce enough economic incentives to keep the system going in spite of endemic corruption? the Sichuan earthquake destroyed many school buildings while others next door were unphased… strongly suggesting corruption in the construction bidding, etc… the Party adeptly focused the media on rescue and reconstruction while ignoring the liability of the officials.

    2. can environmental damage be reversed…poisoned well water and “cancer villages” a tragedy for the rural population and another source of resentment toward factory owners.

  4. Macaca, here’s my take on your two points.

    It would often seem that officials at Local Government level don’t always obey their Beijing hieracy. As a result corners are cut and when it comes to the likes of construction, innocent people pay with their lives for someone elses greed. To cover up the discontent, Local Government officials in Sichuan have been arresting those protesting over the loss of their children!
    However it is in the news regularly that some local Government official or other is caught for corruption then tried, have their worldly possessions taken off them by the State then either jailed or shot. The message will at some time in the future, get through… one hopes!
    I have only one experience with corruption and that was with Customs Officers needing money (in an envelope) to ensure my personal effects did not sit on the wharf till the end of time. I made a complaint, was met by the No2 in Customs for my area and he was horrified. They had only just sacked 11 in that same office for corruption. Result of my meeting was more sackings and further education for those left.

    As I have said several times before, despite their failings in some areas, the Chinese Government know that if they stop delivering on their economic incentives, there will be massive unrest which could lead to a revolution here. I am sure the end of the Government in Romania a few years ago (up against the wall out the back of Parliament Building and Ak47′s blazing away) is etched in the minds of the people in the Chinese Government. The result of any revolution in China would be very bad not only for China but the rest of the world.
    The Government are not short of ways of incentivising the domestic economy making the money go round. Currently, they are not short of foreign exchange either.

    With regards to environmental issues, all in China is not quite as it is portrayed in Western media. Believe it or not, they have made some very positive steps to addressing some of the issues. From what I know they are:
    1) Jan 2008, Government legislated no more plastic carry bags to be issued free at supermarkets after June 1st 2008. Result, trillions of bags no longer made and used.
    2) 2007 or 2008, Government legislated that they wanted 70,000 wind turbines generating electricity within a certain time frame… things seem to be well under way to achieving this first stage in reducing their dependance in burning coal for electricity generation.
    3) In the Province where I live and the one south of here where I have spent considerable time, there have been 10′s of millions of shrubs and trees planted out not only to look good, but also to help soak up CO2 etc. This will help reverse some of the problems from the past and the scale of these plantings has to be seen to be believed. I assume it is also going on in other areas from the fleeting glimpses I have had when visiting other Provinces.
    4) One of the many Coal Fired Power Stations has just completed trials of a chimney stack scrubber. Seems this worked well taking out particulate matter and gases (I think). Next step I am sure will be Government will legislate that by a certain date all CFPS’s must have same scrubbers.
    5) Recycling is very much alive and well here with all plastics, metals, glass, etc processed, not dumped.

    With regards to the really badly polluted areas, I have no idea how they tidy things up once pollutants have got into the ground water. Maybe highly sophisticated filtering systems…? But I am sure that where there is a will (and the money) there is a way. The Government are/will kill those responsible for the really bad pollution and when they have killed enough, others will think twice about polluting.

    Only when China revises its education system will things start to change. People here are not taught to think or reason. They are taught to cheat and copy so that they can obtain certificates which may lead on to a good job. Because “wealth” is a new phenomenon here, people do things without understanding the ramifications of their actions in there rush to acquire it.
    The “herd” mentality is also prevalent with people in general being very Nationalistic. They are also very reluctant in most instances to speak out against the wrongs of the system.
    But despite all their failings, there are some genuinely nice people here and a very, very strong will to achieve and create a better world, something that seems to have been lost in the West some years ago when complacency set in.

  5. William is right…the Chinese leaders are smarter than the markets and other WORLD leaders and will navigate their economy past other nation economies.
    Once world wide focus is redirected at the Chinese and there true ambitions (money) the Chinese people will be caring pitch forks in the streets.
    A resource economy is inevitable.

  6. Look at my comment on 21st September and then read this:

    SYDNEY (Reuters) – Britain’s The Independent newspaper Tuesday reported that Gulf Arab states were in secret talks with Russia, China, Japan and France to replace the U.S. dollar with a basket of currencies in the trading of oil.

    The U.S. dollar eased after the report, written by Middle East correspondent Robert Fisk and monitored on The Independent’s Web site. It cited unidentified sources in Gulf Arab states and Chinese banking sources in Hong Kong.

    Fisk said the proposal was for trade in crude oil to move over nine years to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, the United Arab Emirates, Kuwait and Qatar.

    “Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars,” said the report. It added that France had also been involved in the talks.

    Most Gulf Arab states have pegged their currencies to the dollar.

    The Independent said U.S. authorities were aware that the meetings had taken place but had not discovered the details and were “sure to fight this international cabal.”

    The issue of shifting oil trade away from the U.S. dollar has been raised occasionally in recent years, but analysts and experts say it is unlikely to occur any time soon.

    “I don’t think we will see much concrete actions coming out of such discussions because even when the dollar is weak, it doesn’t mean that commodities are undervalued,” said David Moore, commodities analyst at the Commonwealth Bank of Australia.

    “In fact, when the dollar weakens, commodities prices tend to increase by a higher ratio.”

    Iran began settling most of its crude oil exports in non-dollar currencies, primarily the euro, several years ago, but the actual price for its oil is still set in dollar terms.

    The U.S. dollar dipped in the wake of the report, with analysts cautious about reading too much into it, particularly given the nine-year timeframe.

    The euro edged up to $1.4691 from $1.4662 before the news broke, while the dollar eased to 89.00 yen from 89.40.

    “This looks to be a very long-term thing with a few hurdles to cross,” said Jonathan Cavenagh, currency analyst at Westpac in Sydney. “Foremost, China needs to be more flexible with its currency.”

    “Still, this is U.S. dollar negative news which is moving markets and shows that central banks not just in Asia are looking to diversify away from the US dollar,” he added.

    (Reporting by Wayne Cole; Editing by Mark Bendeich and Dayan Candappa)

    The US$ is on the way out as the International Trade Currency… which nation will implode through the Bubble Effect???? China or the USA??? Me thinks not China.

  7. William, you seem to have this disillusionment that the US can “implode” and not have a horribly negative impact on China. The two are closely connected economically. I think your obvious regional biases cloud your judgment a bit.

  8. For me, China is just a place to conduct business and make money. It is not an easy place to do business as many things here are so old fashioned and slow. I certainly agree that ‘currently’ the two countries are very closely intertwined, I mean they have loaned the USA so much money, they basically own you.
    Have a look at this article:

    DALIAN, China (Reuters) – Following are highlights of a speech by Chinese Premier Wen Jiabao at a meeting of the World Economic Forum in the northeast city of Dalian.

    OVERCAPACITY A CHALLENGE:

    “The major challenge we are facing now is overcapacity, which has come at the same time as a sharp decline in external demand. These problems are creating new difficulties for enterprises.”

    CHALLENGES AHEAD:

    “The foundations of China’s economic recovery are not stable, not solidified and unbalanced. There are still many uncertainties in the outlook of the global economy.

    “There is still heavy downward pressure on external demand, and there are still many factors restricting the expansion of domestic demand in the short term.

    “The effectiveness of some policies will wane gradually and it will take time for some long-term reforms to show results.”

    RISKS, INCLUDING INFLATION:

    “We should fully implement and continuously improve policies and discover and resolve new problems in a timely manner. We should be alert and prevent all potential risks, including inflation.”

    POLICY DIRECTION STABLE:

    “We cannot and will not change the direction of our policies at an inappropriate time. The top priority of our work is to maintain stable and quick economic growth, so we will unswervingly stick to a relatively loose monetary policy and a proactive fiscal policy.”

    “Overall, the policies and a slew of packages we took to address the global financial crisis were realistic, timely, helpful and effective.”

    NEED FOR GLOBAL ACTION:

    “All countries in the world need to improve their consensus and strengthen macroeconomic policy coordination, carry out and implement responsible fiscal and monetary policies that comply with their own national conditions, and maintain consistency in their macroeconomic policy direction.

    “They need to press ahead with the reform of the global financial system, enhance cooperation in international financial monitoring, establish an effective crisis alert and handling system, enhance the capacity to handle and prevent potential risks, and promote financial stability and sustainable economic growth.”

    OPPOSING PROTECTIONISM:

    “Protectionism will only drag down the recovery of the global economy. We should be alert to protectionism taking different forms and hidden protectionism. China will fight resolutely against trade and investment protectionism. We will do what we have said.”

    NEED FOR BETTER-BALANCED GROWTH:

    “We need to take it as a priority in our development strategy to achieve balanced development between the rural and urban areas as well as between different geographic regions, focusing on creating new room for growth.

    “We need to implement a more active policy to create jobs.”

    CONTINUING REFORM

    “We need to press ahead with reform of the prices of natural resource products, continue to deepen reform in the taxation and financial systems, enhance capital markets and the banking system, and improve the RMB exchange rate mechanism.”

    He said the reform plans for 10 key industries launched earlier this year would greatly improve China’s ability to sustain its growth.

    BOOSTING DOMESTIC DEMAND:

    “Boosting domestic demand is a long-term strategy for China to develop its economy.

    “China must greatly adjust the structure of internal and external demand and continuously increase the role of domestic demand in boosting economic growth.”

    (Reporting by Eadie Chen, Aileen Wang and David Stanway; Additional reporting by Langi Chiang and Zhou Xin in Beijing; Editing by Jason Subler and Ken Wills)

    All I look forward to is a world which is a little fairer and more equitable than it was under US rule where your MultiNationals where like the Vikings of old. In the meantime, I suggest that you guys have a damn close look at yourselves and see and correct the mistakes that you have made. But I guess you have all lived so high on the hog for such a long time at the expense of others that will be difficult to do. I seems many there fail to even recognise you have a problem. Good luck.

  9. It sounds like this is very personal to you William. I would only conclude by adding that you are making vast generalizations about the U.S. and its citizens (the government of the last 8 years does not speak for all of us) and the wealth gap is the highest in the history of the country so those “high on the hog” you refer to actually represent a small minority of the country.

    Other than that you are probably right, which means you are mostly wrong in your accusations and undue hatred of America. But feel free to defend communist China….That makes a lot of sense.

  10. Its not personal at all but I do believe that in life you get back what you give out…

    I have been to the USA on business and holiday a number of times. I have met a number of nice folks there and in China, most of my European friends are from the USA too. I am not anti “USA” or anti “Americans”. But you have to admit that as a country, you have many issues to address.

    Look around at your country folk, morbid obesity is rampant. You don’t get this way without living high on the hog. Very sick….

    This same greed has seen your labour rates ratched up to such high levels, many of your once sucessful companies can not longer compete on the world stage and many of your products suffer quality issues like your cars for example.

    The greed in your financial institutions has seen peoples investment money gambled at the whim of reckless individuals whose only concerns was their commissions. Much of these so called investments have not been into companies which produce product and sell for profit but pure speculation. You countrymen involved in this fraud seem to in the most part got away without punishment despite the fact that they nearly brought down the worlds financial system.

    In health care you once lead the world, now your system is beset with legal problems because litigation is the name of the game and the cost of your meds is higher than any other Western country because the lobbyists bribe those in Washigton to maintain the status quo and not allow generics to be sold. man you have a problem there.

    Then you have your Multinationals who have raped and pillaged at will overseas. Ever heard of Bhasmati Rice? They have been growing it in India and Pakistan for over 4000 years. Then some greedy clown from the USA comes along. In September 1997, a Texas company called RiceTec won a patent (U.S. Patent No. 5,663,484) on “basmati rice lines and grains.” The patent secures lines of basmati and basmati-like rice and ways of analyzing that rice. RiceTec, owned by Prince Hans-Adam of Liechtenstein, faced international outrage over allegations of biopiracy. It had also caused a brief diplomatic crisis between India and United States with India threatening to take the matter to WTO as a violation of TRIPS which could have resulted in a major embarrassment for the United States.[2] Both voluntarily and due to review decisions by the United States Patent Office, RiceTec has lost most of the claims of the patent, including, most importantly, the right to call their rice lines “basmati.” This was a huge victory for Indian farmers who could have faced enormous economic losses from the patent.

    Yup thats the way to make friends and influence people.

    And so it goes on… personally I think the world has had just about enough of the antics of a number of your politicians and your business people. Its time you guys realised we all live on a very small planet.

    and one final thing… more on your bubble burtsing… have a nice day now ya hear…

    The price of gold is surging on world markets amid fears that the old economic order, based on the supremacy of the US dollar, could be breaking down.

    A new spike has sent the cost of the precious metal to a level not seen before. The dollar slid sharply after yesterday’s report in The Independent that Gulf Arab states are secretly planning to stop trading oil in dollars, and a senior UN official said that the US should be stripped of its position as the main source of currency reserves for other countries.

    The developments come on top of speculation that the Obama administration is operating a policy of benign neglect of the dollar, engineering a devaluation that could help repair some of the economic damage caused by the recession.

    Not since the collapse of the Bretton Woods system in 1971 has gold been treated as the equivalent of a world currency, but The Independent reported that it could form part of a basket of currencies that would be used for oil trading by the end of the next decade.

    The dollar index – which measures the greenback against other currencies – fell 0.7 per cent yesterday and the dollar was lower against all major currencies except the British pound.

    The US government’s $11.86 trillion debt would be easier to repay if the value of the dollar was lower. There is growing concern among economists that the Obama administration could be content to see the currency fall. That would make US exports more competitive and could spark a manufacturing jobs revival.

    Overseas governments are in a bind because they hold trillions of dollars as currency reserves. The situation is particularly sensitive for oil-producing nations, who are paid in dollars for their exports and therefore hold particularly high dollar reserves.

    Gulf Arabs have begun planning n along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, which includes Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

    Secret meetings have been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme.

    The revelation was met with public denials yesterday. The Saudi central bank governor, Muhammad al-Jasser, said: “The future is in god’s hands. Today, the conditions are good for the arrangement we have.” The Japanese Finance Minister, Hirohisa Fujii, said he “doesn’t know anything about it”.

    Dennis Gartman, the US investment guru who writes the daily Gartman Letter, said that no one should be surprised to hear denials. “We are certain that spokespeople for every single nation will be brought to the fore to deny that any such meetings have occurred, that no such decisions have been made, that it is not in anyone’s interest to have held such meetings or made such decisions,” he told clients as The Independent’s story broke. “The market will care not a whit.”

    Simon Johnson, the IMF’s former chief economist, said the countries involved would calculate it was not in their interests to drive the dollar down. ” It would only be great news for the US. They have to pay lip service to the strong dollar policy, but if someone else were to engineer a devaluation, that would be lucky break for the US.”

    - THE INDEPENDENT

  11. Use the tags to post pictures.

    William,

    You seem to be in favor of a downfall of the USA. You sound entirely biased in my opinion and your generalizations about the state of the average American are a clear sign that you believe the government of the last 8 years and the actions of Wall Street represent your average American. Like most foreigners, you’ve been to the US a few times and witnessed the war atrocities under Bush and the economic downfall of the last year and come to grand generalized conclusions about all Americans – most of which are false.

    We are the largest, richest, most innovative and most productive nation on the planet. No civilization has come to dominate the global economy in as dramatic a fashion as the USA has over the last 150 years.

    You trash America, yet we remain the most powerful military, economic and innovative resource the world has. People do the same thing to WalMart here in the states yet they continue to crush the competition.

    I am not terribly familiar with the Austrlian economy, but did you not suffer from many of the same economic plights that you trash America for? In fact, I am quite certain that your housing bubble was far larger. Much like China, you have benefited from the implementation of the system that America perfected. Now you trash it?

    Your logic seems biased and hate filled in my opinion which gives it little to no merit.

  12. 150 years ago, ENGLAND not the USA was dominating the Global Economy and continued to do so well into the 20th Century. At that time in history, the USA was gearing up for its first Civil War and its industrial base was in its infancy.

    Please don’t try to rearrange history to support your failing short lived system.

    And for your information, I am from New Zealand, that little country in the South Pacific that stood up to your country in the 1980′s and said “NO MORE NUKES IN OUR COUNTRY THANKS!” We are the only country to have done that and boy, did your politicians hate it.

    So how can I post pictures on this site????

  13. You’re getting upset William. No need for that. I don’t know where your anger stems from, but it’s obvious that you have a deep hatred for America. I am not the person you should be angry at.

    If you’re trying to find out how to insert images I’ll send you on a short trek – use your horrible USA branded computer to browse the internet (which was founded by the evil US Dept of Defense) to Google (a horrible American company) to find the code (which was written by a terrible American).

    Good luck and enjoy all of these terrible American inventions which have made you so miserable!

    PS – Try not to enjoy my awful American blog which you visit daily!

  14. Bravo, there is nothing like a good wind up is there? I enjoy the daily thrust and parry here, many thanks. I makes me happy to provide your blog with a little entertainment and some good old fashioned truths.

    I made my computer while living in New Zealand out of parts which came from Japan, Taiwan, Korea and China.

    It uses software that MS stole from Apple and to show my contempt for MS, I haven’t paid them for the priviledge of using it.

    It is not anger that I am feeling for your country and I can understand why you are defending it so strongly, instead I feel pity for you. I feel real pity for all those hard working Joes who have lost their jobs to Asia because their politicians and union bosses were so short sighted. I feel pity for all those hard workers who saved for their retirements and have been swindled out of their investments by the recent batch of US con men. I feel sorry for those in your military who are in a number of countries losing their lives to support your armaments industry while trying to tidy up the mess created by your politicians and multinationals.

    Most of all, I feel sorry for those of you in the US who can see that your country has done no wrong, both within its own borders and overseas. Without a change in thinking, the current round of economic woe is nothing compared to what will befall you as a nation. Get out a bit, start to make friends again, don’t be so focused on yourselves. Don’t shoot the messengers who bring you the truth and offer suggestions.

  15. I respect your opinion William. And I even agree with much of what you say. But none of us want or ask for your pity. This country has done more for you than you’re willing to admit, but you’ve lost site of the forest for the trees. You act all unbiased yet you sit in Liaoning China on a computer invented in America….

    Enjoy your Windows XP and the internet that allows you to so freely abuse and “pity” those whom you know nothing of. Just remember that it is the great American ingenuity that allows you to do it….

  16. Ok I take my pity, back.

    The first computer was developed by Charles Babbage (of England). It was called the Differential and Analytical Engine. The programmer for this computer was Ada Lovelace (first programmer). [Not quite correct. Babbage's Differential Engine was not the same as his Analytical Engine. The Differential Engine came first and was more limited.]
    The first completely electronic computer was developed in England in 1943. It was known as Colossus. It took up 1,000 Sq. ft. weighed 30 tons/60,000 pounds. And took 150 kilowatts which is enough power to light up a small town.

    The clever people in the UK invented many things that you guys try and claim as your own.

  17. Oh I love this….

    From Wikipedia, the free encyclopedia
    Timothy Berners-Lee

    Born 8 June 1955 (age 54)[1]
    London, England[1]
    Residence Massachusetts, USA[1]
    Nationality British
    Education The Queen’s College, Oxford
    Occupation Computer Scientist
    Employer World Wide Web Consortium and University of Southampton
    Known for Inventing the World Wide Web
    Title Professor
    Religious beliefs Unitarian Universalism
    Website
    Tim Berners-Lee
    Notes
    Holder of the 3Com Founders Chair at MIT’s Computer Science and Artificial Intelligence Laboratory

    Sir Timothy John “Tim” Berners-Lee, OM, KBE, FRS, FREng, FRSA (born 8 June 1955[1]), is a British engineer and computer scientist and MIT professor credited with inventing the World Wide Web, making the first proposal for it in March 1989. On 25 December 1990, with the help of Robert Cailliau and a young student staff at CERN, he implemented the first successful communication between an HTTP client and server via the Internet.

    Please note “British” Engineer, not American.

  18. Please tell me you’re kidding. The internet was discovered in the 1950′s (when your Englishman was in diapers) by the US defense department – not 1990….

  19. Seriously though – I am off to bed. Have a great day William. We’ll catch up some other time. Best, TPC.

  20. Americans bankrolled their banks with taxpayers money is a “Socialist” move that shocked and dismayed the Capitalists of the world! Bankruptcy and its spoils were whisked away from the eager and hungry vulture capitalists looking for 10 cent on the dollar bargains by a semi-communist , almost totally socialist government act! American! do not fear socialism, you fvcking well “OWN” GM(America) right now! Goddammit! Now, Look honestly at your Holocaust: 45 thousand a year! Kicked out of society! Disenfranchised by lack of adequate medical care! They DIE! How many are Jews? Is Weisental foundation watching? Are Old German Jews worth more than young American Jews? Where is the outcry! The photos of the dying in the slums? The tumors as big as your head? the caskets? The burial grounds? The drama! Did the first Holocaust really occur? Did they not say, “Never Again?” Were they kidding? lying? Did the first to the furnaces die in vain, and is allowing this American holocaust as proof! The Star of David, stained in Palestinian blood, now covering over the American Holocaust? Are the medical insurance companies the new “SS” ? the new “Gestapo” ? Accountants their “Storm Troupers”, the “Selection committees” for the corporatists the corporations? For higher ROI? Is America Fascist? not Socialist at all? Democracy – a word for convenience and excuse only? To the Jewry of America , Shame! Shame! Shame on you! Rise up and defend! Stop hiding in Israel! America like any country will only show greatness in the way it can affortd to treat the least of Americans – right mow, our record is world wide and dismal! We look like modern day Fascists – even Hitler took better care of his own, allowing/enforcing a humane euthanasia over death in the slums, like dogs,from untreated disease! America will shrink in dimension forced by Asian activity and some will struggle to revive a hopelessly unsustainable “Status Quo” , wiser folks will adapt to the changes, the astounding paradigm shifts thrust upon the very fabric of America by the flight of good, hard earned entrusted capital from America where it was entrusted to be invested, to Asian markets, the “Yuan” and to finance “Super Factories” in Asia and to buy resources through-out the world! Free trade opened the doors, and higher ROIs than usual gave incentive, the money took wing, only the investors, the Uber-Rich, unpatriotic, treasonous, shameless capitalists will profit, and America is doomed to the greater depression to pay for it in the next naturally occurring downturn of the capitalistic economy we so nobely live and die for in our wars around the world! We are the world’s biggest suckers, losers to Wall Street treasonists, lost our life savings to swindlers and shysters in a high stakes banking play, about to face conscription for our mercenary services in Afghanistan on behalf of Halliburton(Dubai) fort a pipeline to China’s Turkmenistan Oil Fields, We face a disgruntled Israel ready to “Push the Button” for us in the Middle East, after having lost Iran’s “South Azadegan Oil fields ( the largest oil find in the Middle East in the last Thirty years) by a sale to China, and now face Chinese plutonium in Iran , with Chinese plutonium delivery systems, to protect their new oil acquisition and finally to balance “Mutual Destruction by Nuclear fact for the Jews of Israel, no longer protectable by their close affiliation with U.S.A. no longer harboring concealed weaponry, openly a Nuclear power, and a weak one at that! The worm has turned! We have entered into the “Fourth Turning” in America! A new day is about to break fourth for Americans, unfettered by Capitalist grip, Corporative lobbiests, our vote restored to power over the shareholders vote, the dollar no longer our captor, we are free! I see the silent revolution on the horizon, just after the gully that brings the greater republican depression, a demolished dollar, the “Yuan” in international trade, and the Amero – detached from corrupt capitalism and Washington – a new age for the innocent peons of America! Your trials soon over, dear sweet American peons, a new life of sustainability freedom from the chains of corporatist, capitalists, and their propaganda dogs! Free At Last!