China Triggers the Recession Alarm
- Thread starter CHam
- Start date
now how is that possible?
2 different countries, 2 different populations, 2 different banking systems - following a similar borrowing profile.....
much structure?
10% HHD/GDP would be hard to manage if the wheels fell off, what's your point?
Would you like to rephrase that so I can resist my urge to respond in kind?
At last somebody who understands China:
http://www.businessspectator.com.au...-Qishan-pd20111124-NVQJ8?OpenDocument&src=sph
Main points of the article:
- Aussies worry about China’s reduced industrial activity for the wrong reasons.
- The CCP has only 2 possible responses to a slow-down: a massive boost in domestic consumption or in fixed investment (a big consumer of Aus commodities).
- China is massively underweight in consumption and massively overweight in investment, so the healthy response would be to boost the former and reduce the latter. However to do so would harm the large State owned conglomerates controlled by the apparatchiks and eventually cause the CCP to lose power.
- So in the short term, to ensure its political survival the CCP has no other option than to continue boosting investments to the detriment of consumption, thus guaranteeing a steady market for Aussie exports.
- But in the longer term, the above unbalance will implode, putting our exports at risk.
My own take of this: As has happened many times before, politics will kill the economy and in turn the economy will kill the political system. As weird as it sounds in the midst of crisis in Europe and the US, China is going to be the one most unstable. Just not for now.
Sign of the times: Chinese upper classes preparing their little nests in Western countries in droves. This is happening in my own extended family as we speak.
http://www.businessspectator.com.au...-Qishan-pd20111124-NVQJ8?OpenDocument&src=sph
Main points of the article:
- Aussies worry about China’s reduced industrial activity for the wrong reasons.
- The CCP has only 2 possible responses to a slow-down: a massive boost in domestic consumption or in fixed investment (a big consumer of Aus commodities).
- China is massively underweight in consumption and massively overweight in investment, so the healthy response would be to boost the former and reduce the latter. However to do so would harm the large State owned conglomerates controlled by the apparatchiks and eventually cause the CCP to lose power.
- So in the short term, to ensure its political survival the CCP has no other option than to continue boosting investments to the detriment of consumption, thus guaranteeing a steady market for Aussie exports.
- But in the longer term, the above unbalance will implode, putting our exports at risk.
My own take of this: As has happened many times before, politics will kill the economy and in turn the economy will kill the political system. As weird as it sounds in the midst of crisis in Europe and the US, China is going to be the one most unstable. Just not for now.
Sign of the times: Chinese upper classes preparing their little nests in Western countries in droves. This is happening in my own extended family as we speak.
HHD = household debt.
Stop being a smart a$$.
Exactly what the Spanish, Italians and Greeks are doing - those that can afford to - buying up a bolt hole in the UK and transferring funds out of the country.
It's not normally the middle class that does this. It certainly wasn't in Argentina way back or the USA recently. In both cases the middle class copped a hiding.
The middle class is not "smart money" and they hold their own currency long after the sophisticated have moved their assets o/s. SS posters would consider themselves smarter than the average bear but very few have any strategy for the time when things go pear shaped.
If people are buying here they are "connected".
and Germany between the world wars.
The UK ? They might be attracted by the collapse of the Pound against the Euro but seems like out of the frying pan into the fire. The UK has the 3rd worst debt position in Europe behind Ireland and Greece.
??
Your development being gobbled up by rich Chinese?
no, no - just timing....
i'll bite - me no unnastan?
so as a genuine question - where should I move my unsophisticated money
Steady on...settle...
The graph clearly shows the two samples moving in tandem right ?.....but on different multiples as in the ones you mentioned above.....but the direction/trend is the same.....man you get overheted don't you ?
Joe, I've been here for a looooong time and the other oldtimers know what my answer would be. They disagree with me, and I disagree with them. I don't wish to start another flame war.
If that was a serious question and you want a totally free, totally unqualified opinion you will need to PM me.
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