Related story here. "Trade surplus puts pressure on inflation in China."

A friend of mine was talking at breakfast last Sunday. He's a guy who has owned manufacturing facilities in China and has been on the boards of more companies with them.

He said that all substantial manufacturing facilities over there for companies like Wal-Mart of Mattel have American, British, Dutch, German and/or other western managers. Quality is controlled by these folks. Now it's true that some subcontractors and suppliers may not come under foreign management, but ultimately there are westerners around.

Given that, he said, Mattel had no choice but to apologize for being snotty about China. It was Mattel's people who were responsible.

I thought that was interesting.

Arf