Sunday, April 12, 2009

Mark Wants to Know What's Up With Chinese Sheetrock

Mark,
 
This is not the problem of the Chinese exporters, it is the problem of the USA importers.  The problem is people believe the government assures quality, so anyone who wished can order dangerous or subpar goods from outside the usa and sell it here to people whose sense of "caveat emptor" has atrophied, due to false security in government regulation.
 
But of course we have the same problem domestically with drugs, peanuts, autos, stocks etc.
 
Blame the importer, not the Chinese.
 
If you are a sheetrock dealer, you certainly know sheetrock.  Your job is to spec what you want, and then inspect what you expect.  Because the government pretends it cn assure safety, some importers skip this step, save money.  
 
You would not buy sheetrock from China because to get the same stuff made here you'd have to pay the same price.
 
The problem starts with government regulations, and then breaks down on the action of certain importers.  The Chinese are not in on this at all.  They make goods to importers specifications. In some cases it may be not as direct as that...  it may be more what the lawyers call "constructive notice."    An importer specs usa grade sheetrock, and the price comes back the same.  The importer says too expensive, and the Chinese come back with a lower price.  At some point, the importer fails to ask "how did you do it?"  And the supplier, seeing the importer is pleased, does not offer the fact that the gypsum is cut with sulfur.  

Yes, I think it is not right to fail to disclose everything in a product, but by far more culpable is the importer's failure to ask, especially when he knows damn well what is wrong.  We see this in banking and the securities and exchange industries.  Bernie Madoff comes to mind.

The economic damage was done during the boom.   Now we decide who will pay.  The decision is in, the consumer, the taxpayer.

To my mind the question is what business can be started given this problem... google chinese sheetrock and take a look at some examples.


0 comments: