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Originally Posted by SimpleS14
Here is a very simple example...when Japan sells a Nissan car (bulit in Japan) to someone in the U.S....they (Japan) get U.S. dollars in return. U.S. dollars in Japan are good for one thing.....buying U.S. goods.
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That's the stupidest thing I have ever heard. The name of the game is to minimize costs and maximize profits. Japanese companies are NOT limited to buying only U.S. goods. Just like any well managed company they take their money and REINVEST it for profit. Regarding your example, why would Nissan Japan use their profits to buy expensive U.S. goods if they can produce the same goods at equal quality at a lower price in another country? What they will do is
try to make money on the exchange rate and buy the cheapest materials at the lowest cost. Guess what? In terms of the cheapest labor and cheapest costs the U.S. is NOT the first country to come to mind.
Labor and material costs are WAY cheaper in countries like China, the Philippines, Mexico, etc. so TONS of knock offs can be manufactured in these countries at MUCH LOWER costs and sold on ebay to lower income consumers and EVERYBODY can sport a short shifter, intake manifold, differential cover or whatever. That's the way it is whether anyone likes it or not.