The move to shift to a domestic demand driven service economy seems to be well underway?

China Official Services PMI Rises to 56.7 in June

July 2 (Reuters) — China’s official purchasing managers’ index (PMI) for the services sector rose t o 56.7 in June from May’s 55.2, reversing two months of softening readings, data from the National Bureau of Statistics showed on Tuesday.

The services sector index follows two PMI surveys of China’s vast manufacturing industry that showed factory activity fell to a seven-month low in June, raising expectations for further policy easing to boost growth in the world’s No 2 economy.

A reading below 50 indicates contracting activity and one above 50 means expansion according to the survey methodology.

The China Federation of Logistics and Purchasing conducts the survey on behalf of China’s National Bureau of Statistics.

China’s fast-growing services industry has so far weathered the global slowdown much better than the factory sector, with the PMI consistently signaling healthy expansion and hitting a 10-month high of 58.0 in March.

4 Responses

  1. Well, while the desire for services doesn’t end until a person dies, except for the obsessive personality, the desire for goods is soon satisfied. Innovations are minimally tempting and planned obsolescence leads to frustration which eventually spawns resistance.
    The only reason for assigning a lower status to services than goods that I have been able to come up with is the historical fact that most services were historically delivered for free or next to nothing by women, children and slaves. Why pay for what you could get for free?
    Actually, while I’m at it, I might suggest that the basic assumption of economics that exchange and trade are driven by demand seems to be based on the rather infantile notion that the babe’s demand produces the milk in the teat. Which actually comes first is evidenced by the fact that infants have to be taught to suck.

      1. @WARREN MOSLER, Yes, definition is all. But, telling a starving pauper he’s got no demand will not make it so.
        It is a gross cruelty to get everyone hooked on money only to withhold it until they do what they are told.
        Defining obedience as a virtue does not make it so, either.

      2. and telling a merchant who can’t sell what people want because they can’t afford it that there is demand doesn’t cut it, either.

        so i think we agree.

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