Changing China Set to Shake World Economy, Again

[Publicus]

Yes. I do have an opinion. Specifically related to the OP and to broader issues which are inevitably intertwined with the Chinese economy.

So long as China has no detrimental effect on my financial, physical or spiritual well being, they can do whatever they please.

Regrettably this is probably dreaming.

Care to share your opinion with us?

The regime is toxic.

The economic, environmental and social consequences of that toxicity are still being played out.

Personally I am looking for damage limitation.

And who is going to undertake the damage limitation? And why?

Reformers within the CCP, that's who.

[Publicus]

Two simple questions..

How are you qualified to dismiss so breezily all arguments that do not precisely dovetail with your own?

What makes you so omniscient on matters re China?

Returning to the MP sketch, people come here for a discussion which means there can be more than one answer as no one has a monopoly on knowledge.

Most people ( ie those equipped with a functioning brain and the ability to digest current affairs) appreciate that there are huge issues facing China and that its government is hardly a beacon of respect for human rights ( warning alert; British understatement at work!). But you also argue that a precipitate collapse of the CCP/PRC would have little long term impact on the rest of the world as 80 % of US exports go to Canada etc

So could you just elucidate exactly what point you are trying to make? Your "wingman" SP seems to care not a fig about China if it does not impact him/her, why are you so impassioned about what happens if China if you see the impact as been hardly material if it goes seriously pear-shaped?

Has anything positive happened in China since 1949, or more realistically, since 1990?

Few people outside the PRC have positive views of the CCP but we have to play the cards that are dealt. Wishful thinking is an unhelpful distraction.

Thank you.

Your welcome.

Nomura, Goldman Sachs, Deutsche Bank and the long list of other global banks, corporations, investors take a realistic and analytic approach, not an academic one. Here's the real world analysis from me and then in today's report just from Nomura Securities.

The CCP's infrastructure investments are not producing returns. Exports continue to decline, and in September went negative measured against the previous September. The CCP has developed the PRC on the twin pillars of infrastructure investment and exports. Both are failing, infrastructure investments especially and in particular, hence the $22 trillion real estate bubble, just to mention one bubble among many in the CCP's economy and system of finance, to include a massive credit bubble in the shadow banking system over which Beijing hasn't any control - corruption, corruption, corruption.

Everyone (in a manner of speaking) to include the CCP knows it must realign its macroeconomy, away from infrastructure investment, which has produced several gargantuan valuation or credit bubbles, to include a staggering local government debt load that can' be resolved, to domestic production and consumption. So the race is on.

Which will occur first, which is a game you like to play? The Titanic gets turned hard to steer away from several icebergs in front of it, or just one of the icebergs hits the giant slow moving man made marvel? And the Titanic careens off a couple of the other icebergs closing in on it?

I'd head for the lifeboats (of which there are nowhere near enough).

Many of the CCP have their planes on standby and their homes purchased in Europe, N America, Australia well maintained.

NOMURA: The Chinese Recovery Is Over

But according to Nomura economist Zhiwei Zhang, this is it. This quarter marks the top, and now we're about to see deceleration.

In part, it's because this quarter and recent ones have been driven by unsustainable investment spending that can't continue, while leading indicators and other measures we've seen for September are already showing a slowdown.

Leading indicators of activity suggest China‟s recovery ended in September.

Read more: http://www.businessinsider.com/nomura-the-chinese-recovery-is-over-2013-10#ixzz2iHKkbLXu

Not sure how much first hand experience you have working with investment bank analysts, but while many of them are supremely academically (heaven forbid) gifted their analysis is still only an opinion based on available data ( or if you want to be more cynical based on the agenda of the investment bank and what positions it holds), or put another way the analysis is highly intelligent guesswork. See investment bank analyst performance ( on the whole with a few notable exceptions) in the run up to the collapse of Bear Stearns, Lehmans, Merrill etc

While it is undeniable that China faces some monumental challenges as it juggles and restructures its economy, no one can accurately assess the real scale of the problems faced and certainly have no guaranteed view on the shape of the outcome.

What I still do not understand is that in your earlier posts you were adamant that the collapse of the PRC would have no real impact on the world protected for instance by your claim that 80% of US exports head to Canada, and your intense dislike of the Chinese government is very apparent, so why worry if as you say an implosion is imminent?

I don't pretend to have all the answers, but am certainly no cheerleader for a Chinese collapse as it would make the turmoil of 2008-09 look like a breeze.

New take on the first to happen game:

1. US default

2. PRC implosion

3. EU collapses

4. Steely Dan converts to Islam

Investing institutions deal in billions of dollars a day. One mistake and you're gone.

Academics, whom I respect for what they do, deal in thousands of words each day. A mistake and they revise and move on.

That's a huge difference.

[folium]

Two simple questions..

How are you qualified to dismiss so breezily all arguments that do not precisely dovetail with your own?

What makes you so omniscient on matters re China?

Returning to the MP sketch, people come here for a discussion which means there can be more than one answer as no one has a monopoly on knowledge.

Most people ( ie those equipped with a functioning brain and the ability to digest current affairs) appreciate that there are huge issues facing China and that its government is hardly a beacon of respect for human rights ( warning alert; British understatement at work!). But you also argue that a precipitate collapse of the CCP/PRC would have little long term impact on the rest of the world as 80 % of US exports go to Canada etc

So could you just elucidate exactly what point you are trying to make? Your "wingman" SP seems to care not a fig about China if it does not impact him/her, why are you so impassioned about what happens if China if you see the impact as been hardly material if it goes seriously pear-shaped?

Has anything positive happened in China since 1949, or more realistically, since 1990?

Few people outside the PRC have positive views of the CCP but we have to play the cards that are dealt. Wishful thinking is an unhelpful distraction.

Thank you.

Your welcome.

Nomura, Goldman Sachs, Deutsche Bank and the long list of other global banks, corporations, investors take a realistic and analytic approach, not an academic one. Here's the real world analysis from me and then in today's report just from Nomura Securities.

The CCP's infrastructure investments are not producing returns. Exports continue to decline, and in September went negative measured against the previous September. The CCP has developed the PRC on the twin pillars of infrastructure investment and exports. Both are failing, infrastructure investments especially and in particular, hence the $22 trillion real estate bubble, just to mention one bubble among many in the CCP's economy and system of finance, to include a massive credit bubble in the shadow banking system over which Beijing hasn't any control - corruption, corruption, corruption.

Everyone (in a manner of speaking) to include the CCP knows it must realign its macroeconomy, away from infrastructure investment, which has produced several gargantuan valuation or credit bubbles, to include a staggering local government debt load that can' be resolved, to domestic production and consumption. So the race is on.

Which will occur first, which is a game you like to play? The Titanic gets turned hard to steer away from several icebergs in front of it, or just one of the icebergs hits the giant slow moving man made marvel? And the Titanic careens off a couple of the other icebergs closing in on it?

I'd head for the lifeboats (of which there are nowhere near enough).

Many of the CCP have their planes on standby and their homes purchased in Europe, N America, Australia well maintained.

NOMURA: The Chinese Recovery Is Over

But according to Nomura economist Zhiwei Zhang, this is it. This quarter marks the top, and now we're about to see deceleration.

In part, it's because this quarter and recent ones have been driven by unsustainable investment spending that can't continue, while leading indicators and other measures we've seen for September are already showing a slowdown.

Leading indicators of activity suggest China‟s recovery ended in September.

Read more: http://www.businessinsider.com/nomura-the-chinese-recovery-is-over-2013-10#ixzz2iHKkbLXu

Not sure how much first hand experience you have working with investment bank analysts, but while many of them are supremely academically (heaven forbid) gifted their analysis is still only an opinion based on available data ( or if you want to be more cynical based on the agenda of the investment bank and what positions it holds), or put another way the analysis is highly intelligent guesswork. See investment bank analyst performance ( on the whole with a few notable exceptions) in the run up to the collapse of Bear Stearns, Lehmans, Merrill etc

While it is undeniable that China faces some monumental challenges as it juggles and restructures its economy, no one can accurately assess the real scale of the problems faced and certainly have no guaranteed view on the shape of the outcome.

What I still do not understand is that in your earlier posts you were adamant that the collapse of the PRC would have no real impact on the world protected for instance by your claim that 80% of US exports head to Canada, and your intense dislike of the Chinese government is very apparent, so why worry if as you say an implosion is imminent?

I don't pretend to have all the answers, but am certainly no cheerleader for a Chinese collapse as it would make the turmoil of 2008-09 look like a breeze.

New take on the first to happen game:

1. US default

2. PRC implosion

3. EU collapses

4. Steely Dan converts to Islam

Investing institutions deal in billions of dollars a day. One mistake and you're gone.

Academics, whom I respect for what they do, deal in thousands of words each day. A mistake and they revise and move on.

That's a huge difference.

And how many years did you work in an investment bank?

Do you know the difference for example between a trader, a portfolio manager, an analyst and an economist, and exactly what their responsibilities are to their clients and their employer?

You quote analyst pieces as supporting evidence. Does every analyst at Goldman Sachs for instance have the same opinion? Does every economist have the same view? How about the portfolio managers? What about the guys on the bond desk? Do domestic bonds agree with the global bonds team? The FX desk? The value team? The growth team? Domestic equities or international? The quant team? The derivatives team? How about the traders? Then don't forget the role of compliance, plus the MDs who will make the final call and so want to buy another yacht...

What is the role of published analysis? Is it the same as that seen by select clients? You want to be the lead player in, lets say, Facebook's IPO, are you as a GSAM analyst going to be negative on the stock, sector or market? What do the corporate finance guys think, and the private wealth team salivating to hook the pre-IPO Facebook shareholders as clients?

Bottom line there's that wonderful, if dated, Schwab advert about lipstick and pigs.

Not only does analysis, analysts and the rest of the crew need to be funded, but at the end of the day analysts are human. No one expects them to be right all the time and all forecasts are at the end of the day just highly intelligent, highly academic guesses that often have a multitude of tasks to perform.

If you know what is going to happen in China you can be a billionaire + very quickly if you get the right short positions in place etc, etc

No one denies that China has huge issues to deal with...

No one denies that China's government is authoritarian and devoid of respect for civil liberties, the rule of law, etc....

No one denies that corruption is endemic within the PRC.....

But the key question is what will happen next?

All theories, forecasts and predictions are at best intelligent guesses....why should your answers be right? Is there no other possible outcome? Have you considered every eventuality and factored in every possible black swan ( and I don't mean the excellent movie!)

I don't know the answers and certainly don't pretend to do so.

[Publicus]

And how many years did you work, live, socialize and observe in the CCP-PRC?

Let's compare notes.

And what I said remains true.

As a professional at an institutional investment house, you blow $10 billion and you're gone.

An academic, a position I also respect, deals in some thousands of words daily. One mistake and s/he revises and moves on.

At any rate, it gets difficult when all one has remaining is a fig leaf.

Edited October 21, 2013 by Publicus

[MantisMan]

At any rate, it gets difficult when all one has remaining is a fig leaf.

One important fact that you left out, Publicus, as to why China will burst is it's total lack of Inventiveness and creativity.

It produces NOTHING. It has invented NOTHING. It has created NOTHING.

It only copies, borrows, steals or outright buys technology. And it does so at the expense of it's own nation.

The only creativeness comes with they concoct new fake foods that end up poisoning their own people.

I was in Hong Kong for 8 years. For a city state that see's itself to be way above "Dalu" Mainlanders, in manners, poetry, writing, freedom, critical thinking, literacy and education, it still has not put anything out in the world in the form of technology as the Western countries have.

They rely too much on Western inventions.

Check out AppleDaily just to get your daily dose of Chinese buffoonery.

[LawrenceChee]

 

 

At any rate, it gets difficult when all one has remaining is a fig leaf.

 

 

 

 

 

One important fact that you left out, Publicus, as to why China will burst is it's total lack of Inventiveness and creativity.

 

It produces NOTHING. It has invented NOTHING. It has created NOTHING.

 

It only copies, borrows, steals or outright buys technology. And it does so at the expense of it's own nation.

The only creativeness comes with they concoct new fake foods that end up poisoning their own people.

 

I was in Hong Kong for 8 years. For a city state that see's itself to be way above "Dalu"  Mainlanders, in manners, poetry, writing, freedom, critical thinking, literacy and education, it still has not put anything out in the world in the form of technology as the Western countries have.

They rely too much on Western inventions.

 

Check out AppleDaily just to get your daily dose of Chinese buffoonery.

That's a very good observation. China strength lies on its ability to make something cheaper and faster ...it has never professed to be an innovator

And frankly in all my travels, I believe the west will continue to lead in this area and that is great as everyone has to be good in something

So in the next wave of Chinese economy, I would like to see that greater reliance of domestic consumption and purchasing of foreign interests namely nuclear in UK, property in manhattan ...it's a good strategy like Singapore called economic defense.

Btw the has pipe line in Myanmar is fully operational as of Sunday to bring direct gas from Africa / Myanmar and the likes right into Kunming area. The adjacent oil pipe will be ready next year and this will have an impact on countries like Singapore and Malaysia which depends on port trades as the volume is bound to be affected

Basically if they fail, you won't do any better.

Sent from my iPod touch using Thaivisa Connect Thailand mobile app

[SinglePot]

And not forgetting the major European pharmaceutical company who walked right into the Venus fly trap by moving their global headquarters to Beijing.

Onwards and upwards. One China, one global economy.

Victory for the common man.

[Publicus]

At any rate, it gets difficult when all one has remaining is a fig leaf.

One important fact that you left out, Publicus, as to why China will burst is it's total lack of Inventiveness and creativity.

It produces NOTHING. It has invented NOTHING. It has created NOTHING.

It only copies, borrows, steals or outright buys technology. And it does so at the expense of it's own nation.

The only creativeness comes with they concoct new fake foods that end up poisoning their own people.

I was in Hong Kong for 8 years. For a city state that see's itself to be way above "Dalu" Mainlanders, in manners, poetry, writing, freedom, critical thinking, literacy and education, it still has not put anything out in the world in the form of technology as the Western countries have.

They rely too much on Western inventions.

Check out AppleDaily just to get your daily dose of Chinese buffoonery.

Yes, your point is well taken, very well so.

I among so many others in the West and throughout the Indo-Pacific strategic region very well know the Chinese haven't invented anything since ghost cities, which is only a recent invention. I believe I can say with high confidence that no (or very few) other countries of the world have so many or such large ghost cities. It's an integral part of the property bubble which, in Beijing alone, is figured at USD $22 trillion - now there's quite an invention! A $22 trillion property bubble in the capital city alone. Then there's the rest of the PRC.

The ancient Chinese were pretty good at lucking into things, such as inventing paper and what came to be known as gunpowder, and perhaps the most modern Chinese invention was a rudimentary compass, but after paper, gunpowder and a few other creations, the Chinese got smug and self-satisfied and rested on their laurels, believing they had become kings of the world forever.

The world knows that the Chinese copy, copy, copy - steal, steal, steal.

I've posted to this thread some of the spectacular and compulsive copying and stealing the CCP and the PRChinese have done, such as recreating exact scale replicas of European and US cities, monuments, memorials, Buckingham Palace, the White House etc and creatively inventing Wu Mart (Walmart) and the red and white OFC - Obama Fried Chicken complete with smiling logo etc etc etc (and the Chinese have no clue of the racist overtones to OFC - next they'll be serving watermelon too ). Pages 13 and 14 at this thread have links to news articles and analysis that speak directly to this very point you call attention to.

I choose to leave it others, such as yourself - but several other long term posters - who do regularly remind us of the fact the Chinese couldn't recognize the significance of the Industrial Revolution, much less create it, and have suffered dearly since due to their smug self-satisfaction and completely unjustified arrogance.

They've taken corruption to new heights, that's for sure.

The Chinese haven't done anything right for the past 600 years, right up to this moment and still won't do anything right for as far ahead as the eye can see.

[Publicus]

At any rate, it gets difficult when all one has remaining is a fig leaf.

One important fact that you left out, Publicus, as to why China will burst is it's total lack of Inventiveness and creativity.

It produces NOTHING. It has invented NOTHING. It has created NOTHING.

It only copies, borrows, steals or outright buys technology. And it does so at the expense of it's own nation.

The only creativeness comes with they concoct new fake foods that end up poisoning their own people.

I was in Hong Kong for 8 years. For a city state that see's itself to be way above "Dalu" Mainlanders, in manners, poetry, writing, freedom, critical thinking, literacy and education, it still has not put anything out in the world in the form of technology as the Western countries have.

They rely too much on Western inventions.

Check out AppleDaily just to get your daily dose of Chinese buffoonery.

That's a very good observation. China strength lies on its ability to make something cheaper and faster ...it has never professed to be an innovator

And frankly in all my travels, I believe the west will continue to lead in this area and that is great as everyone has to be good in something

So in the next wave of Chinese economy, I would like to see that greater reliance of domestic consumption and purchasing of foreign interests namely nuclear in UK, property in manhattan ...it's a good strategy like Singapore called economic defense.

Btw the has pipe line in Myanmar is fully operational as of Sunday to bring direct gas from Africa / Myanmar and the likes right into Kunming area. The adjacent oil pipe will be ready next year and this will have an impact on countries like Singapore and Malaysia which depends on port trades as the volume is bound to be affected

Basically if they fail, you won't do any better.

Sent from my iPod touch using Thaivisa Connect Thailand mobile app

Violating copyright laws is illegal and wrong.

Stealing is not to be recommended, to say the least, in any setting and in the global marketplace it is a source of trouble and antagonism, distrust, dishonor, misgivings, suspicions, wariness.

As to the pipeline you insert rather heavy handedly in your post as an attempt to distract from the central point of the absence of any Chinese inventiveness or creativity, Beijing has been on the back foot in Myanmar throughout all of 2013, to include inserting itself in the middle of a shootout between the Katchin minority and the Myanmar government that dates back to 1961. You'd better hope they don't blow up the pipeline as the CCP-PRC is viewed with great hostility by the Katchin and the people of northern Myanmar.

Moreover, the United States has secured veto powers over any and all foreign investments in Myanmar, so you should be nice to us there .

[SinglePot]

"So in the next wave of Chinese economy, I would like to see that greater reliance of domestic consumption and purchasing of foreign interests namely nuclear in UK, property in manhattan ...it's a good strategy like Singapore called economic defense."

Well if China is so good at nuke (if it's good enough for Britain must be good enough for China) why are they importing fossil through Burma. Nuke capability not enough presumably for the voracious demand in China. Btw. French consortium leads the build in the UK. China is a helpful financial passenger.

Not sure what this subtly inserted Manhattan property jibe is all about.

Chinese landlady in Beijing will get her knickers seriously twisted if the property bubble bursts.

I know her well.

Sent from my tablet created in California, assembled in China.

Edited October 22, 2013 by SinglePot

[Publicus]

"So in the next wave of Chinese economy, I would like to see that greater reliance of domestic consumption and purchasing of foreign interests namely nuclear in UK, property in manhattan ...it's a good strategy like Singapore called economic defense."

Well if China is so good at nuke (if it's good enough for Britain must be good enough for China) why are they importing fossil through Burma. Nuke capability not enough presumably for the voracious demand in China. Btw. French consortium leads the build in the UK. China is a helpful financial passenger.

Not sure what this subtly inserted Manhattan property jibe is all about.

Chinese landlady in Beijing will get her knickers seriously twisted if the property bubble bursts.

I know her well.

Sent from my tablet created in California, assembled in China.

I would add that the "next wave" of the CCP-PRC economy is depression after the bubbles burst and the whole rotten scheme collapses.

This is a fact, not wishful thinking. And there's no cheerleading involved. It's just fact. We need to face facts. I've presented plenty of documentation to this thread to prove the point.

Yes, we're all going to suffer, but there's nothing we can do to change the mindset and attitude of the CCP in Beijing.

All the gains that have occurred there during the past 30 years have been empty, hollow, meaningless. It's all going to evaporate. There's nothing to commend the CCP about in this regard. The CCP has created a vicious, self defeating circle.

Again, as for thousands of years, it's the Chinese people who will suffer. But when it happens they're going to get their pound of CCP flesh too.

[LawrenceChee]

"So in the next wave of Chinese economy, I would like to see that greater reliance of domestic consumption and purchasing of foreign interests namely nuclear in UK, property in manhattan ...it's a good strategy like Singapore called economic defense."

Well if China is so good at nuke (if it's good enough for Britain must be good enough for China) why are they importing fossil through Burma. Nuke capability not enough presumably for the voracious demand in China. Btw. French consortium leads the build in the UK. China is a helpful financial passenger.

Not sure what this subtly inserted Manhattan property jibe is all about.

Chinese landlady in Beijing will get her knickers seriously twisted if the property bubble bursts.

I know her well.

Sent from my tablet created in California, assembled in China.

Buying a 900 million building from JP Morgan is a jibe ? Wow you just made dinner conversation for me with my Chinese partners here on how low the hatred can get ...we will salute you with a toast and drink some fine scot whiskey

...

as for nuke technology it's called diversification of your energy needs ...

Sent from my iPod touch using Thaivisa Connect Thailand mobile app

[SinglePot]

"So in the next wave of Chinese economy, I would like to see that greater reliance of domestic consumption and purchasing of foreign interests namely nuclear in UK, property in manhattan ...it's a good strategy like Singapore called economic defense."

Well if China is so good at nuke (if it's good enough for Britain must be good enough for China) why are they importing fossil through Burma. Nuke capability not enough presumably for the voracious demand in China. Btw. French consortium leads the build in the UK. China is a helpful financial passenger.

Not sure what this subtly inserted Manhattan property jibe is all about.

Chinese landlady in Beijing will get her knickers seriously twisted if the property bubble bursts.

I know her well.

Sent from my tablet created in California, assembled in China.

Buying a 900 million building from JP Morgan is a jibe ? Wow you just made dinner conversation for me with my Chinese partners here on how low the hatred can get ...we will salute you with a toast and drink some fine scot whiskey

...

as for nuke technology it's called diversification of your energy needs ...

Sent from my iPod touch using Thaivisa Connect Thailand mobile app

You sure do understand the concept of ownership.

Take care leaving the restaurant after you have toasted me.

And be extra careful with the peasant on a bicycle.

If you are in Beijing that is.

[LawrenceChee]

"So in the next wave of Chinese economy, I would like to see that greater reliance of domestic consumption and purchasing of foreign interests namely nuclear in UK, property in manhattan ...it's a good strategy like Singapore called economic defense."

Well if China is so good at nuke (if it's good enough for Britain must be good enough for China) why are they importing fossil through Burma. Nuke capability not enough presumably for the voracious demand in China. Btw. French consortium leads the build in the UK. China is a helpful financial passenger.

Not sure what this subtly inserted Manhattan property jibe is all about.

Chinese landlady in Beijing will get her knickers seriously twisted if the property bubble bursts.

I know her well.

Sent from my tablet created in California, assembled in China.

Buying a 900 million building from JP Morgan is a jibe ? Wow you just made dinner conversation for me with my Chinese partners here on how low the hatred can get ...we will salute you with a toast and drink some fine scot whiskey

...

as for nuke technology it's called diversification of your energy needs ...

Sent from my iPod touch using Thaivisa Connect Thailand mobile app

You sure do understand the concept of ownership.

Take care leaving the restaurant after you have toasted me.

And be extra careful with the peasant on a bicycle.

If you are in Beijing that is.

Mods - This has to be racist / degrading comment and highly offending ? I have been civil for a long while but his one liner comments about peasants is hardly funny at all and getting very tired and ungentlemanly

Sent from my iPod touch using Thaivisa Connect Thailand mobile app

[SinglePot]

Toasting my health in a Beijing restaurant is offensive.

Toasting my health in a Chiang Mai restaurant is a far more serious indictment.

[Scott]

Keep it civil.

[Scott]

We now have another thread in which nobody has anything further to say, so they start fighting like children.

Here's another topic that might be of interest: http://www.thaivisa.com/forum/topic/676370-china-crackdown-to-come-under-scrutiny-at-un-rights-review/#entry6950929

//Closed//