China cuts interest rates again to spur economic growth

[Scott]

An off-topic post has been removed. The thread is about China's cutting of interest rates.

[LawrenceChee]

"Chinese are expected to spend $116.8 billion on luxury goods this year, accounting for 46% of the world’s total, said the Fortune Character Institute."

Chinese spend a lot on luxury goods, just not in China

As I interact with many middle class Chinese this year , I am heartened to see the desired is slowing down for material things and losing the desire to acquire useless pretty things. A few is nice but when you centre your life around it it's rather silly and I'm happy if LVMH doesn't make as much $$$ in 2016

It's a path to destruction and credit cards dependency that ultimately put a toll on family happiness

I'm happy when I see a balanced lifestyle ....it's healthier this way...I'm equally at home at four seasons sipping a cup of tea as I am hanging out in front of 7-11 hang dong eating an ice cream pop sitting on the pavement with my Vespa pals

[Publicus]

The old line hard core Maoists absolutely do not want the needed reforms to transform to a domestically driven consumer based economy. This is what is preventing economic reforms away from the export economy and massive capital investments in infrastructure.

Infrastructure investments would continue but they are grossly misallocated and have a terrible rate of return because of massive humongous corruption and overbuilt projects, such as the huge oversupply of housing, bridges to nowhere.

While there are CCP Chinese who do buy and spend, consume, there are not enough. The compulsion among the CCP people is to save. They have a small or nonexistent social safety net. They don't trust or believe the CCP and its cadres. The CCP Chinese people see the failing economy. They see the incompetence of the CCP leadership.

Many Chinese don't like the CCP system of government. The increasing middle class want accountability from their government, not the 3000 years of dictatorship the CCP preserves and extends. An increasing number of the Chinese people see the system failing. They see that the CCP is what they'd feared, i.e., another ruling clique of selfish and incompetent leaders who betray China and the people of China.

Many Chinese never wanted to believe only the Communist Party can govern China, which it cannot, never could do. As the CCP economy begins its irreversible failure, the people feel a certain sense of relief about it. But that does not mitigate their apprehension for their future and the future of the country and its rapidly increasing inevitable fate.

CCP is a young and nervous dynasty. The people are nervous and apprehensive too.

Edited November 25, 2015 by Publicus

[LawrenceChee]

The old line hard core Maoists absolutely do not want the needed reforms to transform to a domestically driven consumer based economy. This is what is preventing economic reforms away from the export economy and massive capital investments in infrastructure.

Infrastructure investments would continue but they are grossly misallocated and have a terrible rate of return because of massive humongous corruption and overbuilt projects, such as the huge oversupply of housing, bridges to nowhere.

While there are CCP Chinese who do buy and spend, consume, there are not enough. The compulsion among the CCP people is to save. They have a small or nonexistent social safety net. They don't trust or believe the CCP and its cadres. The CCP Chinese people see the failing economy. They see the incompetence of the CCP leadership.

Many Chinese don't like the CCP system of government. The increasing middle class want accountability from their government, not the 3000 years of dictatorship the CCP preserves and extends. An increasing number of the Chinese people see the system failing. They see that the CCP is what they'd feared, i.e., another ruling clique of selfish and incompetent leaders who betray China and the people of China.

Many Chinese never wanted to believe only the Communist Party can govern China, which it cannot, never could do. As the CCP economy begins its irreversible failure, the people feel a certain sense of relief about it. But that does not mitigate their apprehension for their future and the future of the country and its rapidly increasing inevitable fate.

CCP is a young and nervous dynasty. The people are nervous and apprehensive too.

The points mentioned here are in some perspectives skewed and in some perspectives correct

There are no Maoists ....Chinese are not fanatic in that sense. I keep a few Maoist pictures not out of idolatry but from an artistic retro aspect and many do these collections

Infrastructure continues to be important for the Chinese as more moves into middle class status they want a stable railway , they want roads they want bridges to cut driving time and they want to be able to afford to buy a nice condo with gardens , childcare facilities etc so in the coming years , this will continue to be important driver in a slower economy

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout . It's nothing to do with the CCP or any government , Asians have family networks to assist in emergencies but in most cases its your own savings. We don't like credit cards much

Many Chinese honestly don't care for the government CCP or whoever is in charge ....that's the pragmatic approach will take a lot for some Americans to understand as the culture in America Centres around voicing your opinion no matter how silly it looks on TV

Most Chinese don't believe any government can govern China and yet the CCP has in most cases delivered what the citizens need and the Chinese being pragmatic is happy to let it run for the time being while it serves a function

The future is unknown for any political parties , I say the CCP is adapting to the cultures and future ...whether it's fast enough to please the masses ...I remember Julius Caesar best ....one can never control the mob ...the CCP will do well to remember this well

Edited November 26, 2015 by LawrenceChee

[Publicus]

IMF board of directors will vote today to put the yuan (RMB) into its basket of SDR currencies to join the USD, EURO, Yen, GBP.

The yuan is only 2% of all global reserve currencies and 3% of global trade transactions, but the EU and UK want the yuan in the basket.

CCP Boyz in Beijing have been angling for his for ten years so they're thrilled. Most importantly to them presently, it means they can borrow globally which is the only way they can borrow at the present time. CCP domestic banks are dry as a bone of liquidity. Not to mention in huge debt with mushrooming NPLs. IMF well knows that if the CCP can't start borrowing globally right now the Boyz are going down and under very quickly and very soon.

Washington will not use its veto power over who gets included in the SDR basket, so we'll see what weighting the yuan gets in it. CCP owes Washington big time on this one too.

Yuan might get weighted at between 14% to 16%, or it might get weighted at as little as 10% to 12%. Anything less than 10% would essentially be a bust as markets would not take it as seriously.

Whatever the weighting, most or all of it will be subtracted and deducted from the euro and the GBP. The Eurozone (Germany) and UK along with France want the yuan included, they can have it included. Hollande is trying to get France back in to the CCP China market after Sarkozy had infuriated the CCP Dictators with his attitude and policies (Taiwan especially from Sarkozy's days at the Defense Ministry).

Everyone expects the IMF Board to say yes to the CCP Boyz BUT you have to do this and you have to do that, then you need to do yet these and those things etc. There are too many objections for the yuan to run freely once it's in the basket. The major objection is that the CCP's personal Central Bank is not independent, which is an IMF requirement to be included in the SDR basket and which IMF is ignoring.

Another objection is that the yuan still is not fully convertible.

Yet another objection is that it's a difficult currency to see. Beijing the past several dayze has (again) beet at the max of air pollution level. Hard to see through all that blackness at noon.

The concern now which is 99% real is that the Boyz will move to complete the yuan devaluation they began in August but had to stop because of the strongly negative reaction of global markets. CCP reforms are dead in the water so they need to support the yuan as exports continue to tank, since 2012 . A 20% yuan devaluation as the CCP needs will run the global economy off a cliff.

May you live in interesting times.

Edited November 30, 2015 by Publicus

[LawrenceChee]

So China is in ....and again there is no surprise acknowledging the worlds second biggest economy

Small pockets of naysayers vs large group of practical politicians

World goes on ....I'm still eating my breakfast and today looks like an interesting and busy day

[sandyf]

So China is in ....and again there is no surprise acknowledging the worlds second biggest economy

Small pockets of naysayers vs large group of practical politicians

World goes on ....I'm still eating my breakfast and today looks like an interesting and busy day

Yes, maybe we can now hope that Congress will now come to their senses.

A few years back large chunks of UK manufacturing were wiped out. Devastating for some areas at the time. The majority have picked themselves up and moved on.

It would appear the many believe China incapable of adjusting to change.

[LawrenceChee]

So China is in ....and again there is no surprise acknowledging the worlds second biggest economy

Small pockets of naysayers vs large group of practical politicians

World goes on ....I'm still eating my breakfast and today looks like an interesting and busy day

Yes, maybe we can now hope that Congress will now come to their senses.

A few years back large chunks of UK manufacturing were wiped out. Devastating for some areas at the time. The majority have picked themselves up and moved on.

It would appear the many believe China incapable of adjusting to change.

I would hope not as I have dedicated my life driving and pushing for slower growth and environmental protection with Politicians on the ground and many agree and share similar views

For many who actually have visited China there is still hinterlands that are gorgeous , beautiful and am breathtaking and I would hope for generations of Chinese to grow up and be able to see that in their lifetime

China needs to continue to reform at its own ground, protect its key industries and drop the polluting mass production that makes nothing useful except to satisfy consumers from the world fed on cheap disposal useless junk

[Publicus]

The old line hard core Maoists absolutely do not want the needed reforms to transform to a domestically driven consumer based economy. This is what is preventing economic reforms away from the export economy and massive capital investments in infrastructure.

Infrastructure investments would continue but they are grossly misallocated and have a terrible rate of return because of massive humongous corruption and overbuilt projects, such as the huge oversupply of housing, bridges to nowhere.

While there are CCP Chinese who do buy and spend, consume, there are not enough. The compulsion among the CCP people is to save. They have a small or nonexistent social safety net. They don't trust or believe the CCP and its cadres. The CCP Chinese people see the failing economy. They see the incompetence of the CCP leadership.

Many Chinese don't like the CCP system of government. The increasing middle class want accountability from their government, not the 3000 years of dictatorship the CCP preserves and extends. An increasing number of the Chinese people see the system failing. They see that the CCP is what they'd feared, i.e., another ruling clique of selfish and incompetent leaders who betray China and the people of China.

Many Chinese never wanted to believe only the Communist Party can govern China, which it cannot, never could do. As the CCP economy begins its irreversible failure, the people feel a certain sense of relief about it. But that does not mitigate their apprehension for their future and the future of the country and its rapidly increasing inevitable fate.

CCP is a young and nervous dynasty. The people are nervous and apprehensive too.

The points mentioned here are in some perspectives skewed and in some perspectives correct

There are no Maoists ....Chinese are not fanatic in that sense. I keep a few Maoist pictures not out of idolatry but from an artistic retro aspect and many do these collections

Infrastructure continues to be important for the Chinese as more moves into middle class status they want a stable railway , they want roads they want bridges to cut driving time and they want to be able to afford to buy a nice condo with gardens , childcare facilities etc so in the coming years , this will continue to be important driver in a slower economy

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout . It's nothing to do with the CCP or any government , Asians have family networks to assist in emergencies but in most cases its your own savings. We don't like credit cards much

Many Chinese honestly don't care for the government CCP or whoever is in charge ....that's the pragmatic approach will take a lot for some Americans to understand as the culture in America Centres around voicing your opinion no matter how silly it looks on TV

Most Chinese don't believe any government can govern China and yet the CCP has in most cases delivered what the citizens need and the Chinese being pragmatic is happy to let it run for the time being while it serves a function

The future is unknown for any political parties , I say the CCP is adapting to the cultures and future ...whether it's fast enough to please the masses ...I remember Julius Caesar best ....one can never control the mob ...the CCP will do well to remember this well

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout .

Money and wise use of resources is socio-economic and also cultural. Nothing to do with DNA, so one can hope the reference is loose or rhetorical. Everyone you mentioned did in fact reject (China) or dismissed the Industrial Revolution. The consequence is that 250 years after the Industrial Revolution 2/3 of the world's poorest people live on the continent of Asia. The continent also has (far) too many people anyway.

that's the pragmatic approach

Suggest 'malleable' as a more accurate word.

When Chinese on a weekend walk through caves where rugged ancestors lived 5000 years ago, and they or visitors view the mannequins depicted in their rough settings, they think pragmatic and they're right to think that. Since the French Revolution and democracy in the United States however a different word applies. Malleable is a good one among many like it. Politically malleable....there are a number of synonyms. And an enforced dictatorship that is censoring and punishing is ancient, decrepit, criminal.

For a hundred years China has predicated its revival on a German named Marx and a Russian named Lenin. Extending from those two are Mao, Deng and another great fall. Ideology is a brain disease and it is promoted each and every day in the CCP China.

[LawrenceChee]

The old line hard core Maoists absolutely do not want the needed reforms to transform to a domestically driven consumer based economy. This is what is preventing economic reforms away from the export economy and massive capital investments in infrastructure.

Infrastructure investments would continue but they are grossly misallocated and have a terrible rate of return because of massive humongous corruption and overbuilt projects, such as the huge oversupply of housing, bridges to nowhere.

While there are CCP Chinese who do buy and spend, consume, there are not enough. The compulsion among the CCP people is to save. They have a small or nonexistent social safety net. They don't trust or believe the CCP and its cadres. The CCP Chinese people see the failing economy. They see the incompetence of the CCP leadership.

Many Chinese don't like the CCP system of government. The increasing middle class want accountability from their government, not the 3000 years of dictatorship the CCP preserves and extends. An increasing number of the Chinese people see the system failing. They see that the CCP is what they'd feared, i.e., another ruling clique of selfish and incompetent leaders who betray China and the people of China.

Many Chinese never wanted to believe only the Communist Party can govern China, which it cannot, never could do. As the CCP economy begins its irreversible failure, the people feel a certain sense of relief about it. But that does not mitigate their apprehension for their future and the future of the country and its rapidly increasing inevitable fate.

CCP is a young and nervous dynasty. The people are nervous and apprehensive too.

The points mentioned here are in some perspectives skewed and in some perspectives correct

There are no Maoists ....Chinese are not fanatic in that sense. I keep a few Maoist pictures not out of idolatry but from an artistic retro aspect and many do these collections

Infrastructure continues to be important for the Chinese as more moves into middle class status they want a stable railway , they want roads they want bridges to cut driving time and they want to be able to afford to buy a nice condo with gardens , childcare facilities etc so in the coming years , this will continue to be important driver in a slower economy

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout . It's nothing to do with the CCP or any government , Asians have family networks to assist in emergencies but in most cases its your own savings. We don't like credit cards much

Many Chinese honestly don't care for the government CCP or whoever is in charge ....that's the pragmatic approach will take a lot for some Americans to understand as the culture in America Centres around voicing your opinion no matter how silly it looks on TV

Most Chinese don't believe any government can govern China and yet the CCP has in most cases delivered what the citizens need and the Chinese being pragmatic is happy to let it run for the time being while it serves a function

The future is unknown for any political parties , I say the CCP is adapting to the cultures and future ...whether it's fast enough to please the masses ...I remember Julius Caesar best ....one can never control the mob ...the CCP will do well to remember this well

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout .

Money and wise use of resources is socio-economic and also cultural. Nothing to do with DNA, so one can hope the reference is loose or rhetorical. Everyone you mentioned did in fact reject (China) or dismissed the Industrial Revolution. The consequence is that 250 years after the Industrial Revolution 2/3 of the world's poorest people live on the continent of Asia. The continent also has (far) too many people anyway.

that's the pragmatic approach

Suggest 'malleable' as a more accurate word.

When Chinese on a weekend walk through caves where rugged ancestors lived 5000 years ago, and they or visitors view the mannequins depicted in their rough settings, they think pragmatic and they're right to think that. Since the French Revolution and democracy in the United States however a different word applies. Malleable is a good one among many like it. Politically malleable....there are a number of synonyms. And an enforced dictatorship that is censoring and punishing is ancient, decrepit, criminal.

For a hundred years China has predicated its revival on a German named Marx and a Russian named Lenin. Extending from those two are Mao, Deng and another great fall. Ideology is a brain disease and it is promoted each and every day in the CCP China.

Wow when one can't even quote a mm expressive term with freedom of speech without being slammed with all sorts of terms ....that's dictatorship in the Internet m and a real irony coming from an American who seems to survive sprouting freedom Everyday

Lol this is life ...American talk the loudest

[Harsh Jones]

The old line hard core Maoists absolutely do not want the needed reforms to transform to a domestically driven consumer based economy. This is what is preventing economic reforms away from the export economy and massive capital investments in infrastructure.

Infrastructure investments would continue but they are grossly misallocated and have a terrible rate of return because of massive humongous corruption and overbuilt projects, such as the huge oversupply of housing, bridges to nowhere.

While there are CCP Chinese who do buy and spend, consume, there are not enough. The compulsion among the CCP people is to save. They have a small or nonexistent social safety net. They don't trust or believe the CCP and its cadres. The CCP Chinese people see the failing economy. They see the incompetence of the CCP leadership.

Many Chinese don't like the CCP system of government. The increasing middle class want accountability from their government, not the 3000 years of dictatorship the CCP preserves and extends. An increasing number of the Chinese people see the system failing. They see that the CCP is what they'd feared, i.e., another ruling clique of selfish and incompetent leaders who betray China and the people of China.

Many Chinese never wanted to believe only the Communist Party can govern China, which it cannot, never could do. As the CCP economy begins its irreversible failure, the people feel a certain sense of relief about it. But that does not mitigate their apprehension for their future and the future of the country and its rapidly increasing inevitable fate.

CCP is a young and nervous dynasty. The people are nervous and apprehensive too.

The points mentioned here are in some perspectives skewed and in some perspectives correct

There are no Maoists ....Chinese are not fanatic in that sense. I keep a few Maoist pictures not out of idolatry but from an artistic retro aspect and many do these collections

Infrastructure continues to be important for the Chinese as more moves into middle class status they want a stable railway , they want roads they want bridges to cut driving time and they want to be able to afford to buy a nice condo with gardens , childcare facilities etc so in the coming years , this will continue to be important driver in a slower economy

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout . It's nothing to do with the CCP or any government , Asians have family networks to assist in emergencies but in most cases its your own savings. We don't like credit cards much

Many Chinese honestly don't care for the government CCP or whoever is in charge ....that's the pragmatic approach will take a lot for some Americans to understand as the culture in America Centres around voicing your opinion no matter how silly it looks on TV

Most Chinese don't believe any government can govern China and yet the CCP has in most cases delivered what the citizens need and the Chinese being pragmatic is happy to let it run for the time being while it serves a function

The future is unknown for any political parties , I say the CCP is adapting to the cultures and future ...whether it's fast enough to please the masses ...I remember Julius Caesar best ....one can never control the mob ...the CCP will do well to remember this well

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout .

Money and wise use of resources is socio-economic and also cultural. Nothing to do with DNA, so one can hope the reference is loose or rhetorical. Everyone you mentioned did in fact reject (China) or dismissed the Industrial Revolution. The consequence is that 250 years after the Industrial Revolution 2/3 of the world's poorest people live on the continent of Asia. The continent also has (far) too many people anyway.

that's the pragmatic approach

Suggest 'malleable' as a more accurate word.

When Chinese on a weekend walk through caves where rugged ancestors lived 5000 years ago, and they or visitors view the mannequins depicted in their rough settings, they think pragmatic and they're right to think that. Since the French Revolution and democracy in the United States however a different word applies. Malleable is a good one among many like it. Politically malleable....there are a number of synonyms. And an enforced dictatorship that is censoring and punishing is ancient, decrepit, criminal.

For a hundred years China has predicated its revival on a German named Marx and a Russian named Lenin. Extending from those two are Mao, Deng and another great fall. Ideology is a brain disease and it is promoted each and every day in the CCP China.

So you get poor by saving money ? This is simply ridiculous and has no place in reality. Germany has the strongest economy in the west and has the highest SAVINGS rate.

[ExpatOilWorker]

The old line hard core Maoists absolutely do not want the needed reforms to transform to a domestically driven consumer based economy. This is what is preventing economic reforms away from the export economy and massive capital investments in infrastructure.

Infrastructure investments would continue but they are grossly misallocated and have a terrible rate of return because of massive humongous corruption and overbuilt projects, such as the huge oversupply of housing, bridges to nowhere.

While there are CCP Chinese who do buy and spend, consume, there are not enough. The compulsion among the CCP people is to save. They have a small or nonexistent social safety net. They don't trust or believe the CCP and its cadres. The CCP Chinese people see the failing economy. They see the incompetence of the CCP leadership.

Many Chinese don't like the CCP system of government. The increasing middle class want accountability from their government, not the 3000 years of dictatorship the CCP preserves and extends. An increasing number of the Chinese people see the system failing. They see that the CCP is what they'd feared, i.e., another ruling clique of selfish and incompetent leaders who betray China and the people of China.

Many Chinese never wanted to believe only the Communist Party can govern China, which it cannot, never could do. As the CCP economy begins its irreversible failure, the people feel a certain sense of relief about it. But that does not mitigate their apprehension for their future and the future of the country and its rapidly increasing inevitable fate.

CCP is a young and nervous dynasty. The people are nervous and apprehensive too.

The points mentioned here are in some perspectives skewed and in some perspectives correct

There are no Maoists ....Chinese are not fanatic in that sense. I keep a few Maoist pictures not out of idolatry but from an artistic retro aspect and many do these collections

Infrastructure continues to be important for the Chinese as more moves into middle class status they want a stable railway , they want roads they want bridges to cut driving time and they want to be able to afford to buy a nice condo with gardens , childcare facilities etc so in the coming years , this will continue to be important driver in a slower economy

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout . It's nothing to do with the CCP or any government , Asians have family networks to assist in emergencies but in most cases its your own savings. We don't like credit cards much

Many Chinese honestly don't care for the government CCP or whoever is in charge ....that's the pragmatic approach will take a lot for some Americans to understand as the culture in America Centres around voicing your opinion no matter how silly it looks on TV

Most Chinese don't believe any government can govern China and yet the CCP has in most cases delivered what the citizens need and the Chinese being pragmatic is happy to let it run for the time being while it serves a function

The future is unknown for any political parties , I say the CCP is adapting to the cultures and future ...whether it's fast enough to please the masses ...I remember Julius Caesar best ....one can never control the mob ...the CCP will do well to remember this well

Chinese have in our DNA to save like most Asian cultures it's not unique to China , Japan , Thailand Malaysia , Philippines you will always find Asians saving for a rainy day and not trusting their governments for any handout .

Money and wise use of resources is socio-economic and also cultural. Nothing to do with DNA, so one can hope the reference is loose or rhetorical. Everyone you mentioned did in fact reject (China) or dismissed the Industrial Revolution. The consequence is that 250 years after the Industrial Revolution 2/3 of the world's poorest people live on the continent of Asia. The continent also has (far) too many people anyway.

that's the pragmatic approach

Suggest 'malleable' as a more accurate word.

When Chinese on a weekend walk through caves where rugged ancestors lived 5000 years ago, and they or visitors view the mannequins depicted in their rough settings, they think pragmatic and they're right to think that. Since the French Revolution and democracy in the United States however a different word applies. Malleable is a good one among many like it. Politically malleable....there are a number of synonyms. And an enforced dictatorship that is censoring and punishing is ancient, decrepit, criminal.

For a hundred years China has predicated its revival on a German named Marx and a Russian named Lenin. Extending from those two are Mao, Deng and another great fall. Ideology is a brain disease and it is promoted each and every day in the CCP China.

So you get poor by saving money ? This is simply ridiculous and has no place in reality. Germany has the strongest economy in the west and has the highest SAVINGS rate.

For comparison do you have the same chart for China and maybe even Thailand?

[Publicus]

He keeps flying on through posting whatever has caught his eye that he thinks might do the trick for the moment.

Y'know, the Zero Hedge Syndrome of post a lotta charts and even lots more graphs even if they have no connection. Just keep throwin' all the graphics up there. Headlines too. It's supposed to convince everyone the new world order of the global far right is on the cusp.

Really, here we are talking about China and the guy posts a chart about Europe only.

[Publicus]

CCP economics reformers led by Xi Jinping and the English fluent PM Li Kejiang very well know they must transition the economy to a domestically driven one, that household consumption is the only way to go about it.

However, the CCP economics reformers are facing resistance from hard-core Maoists who want a pure people living in the fields. The conflict within the two CCP major factions goes back to Mao vs Deng from the founding of the PRC in 1949. Deng was alternately up and down, in and out of the inner circles, depending on which faction could get the upper hand of the moment. After Mao died, Deng finally grabbed the brass ring.

So here we are.

CCP China has a gross national savings rate of about 51 percent, according to the World Bank. In the US, it hovers around 17 percent.

(China's savings is commonly quoted between 30-35%, while the USA households around 5%.)

Maoists point to the fact the Chinese people are savers, not spenders. Yes, household consumption has increased due to the Party's unrelenting campaign the past several years to get CCP Chinese to spend. But consumption as a percentage of GDP is still half that of the US, Europe; the advanced economies.

Either way for the economics reformers of the CCP it's all uphill. For the political reformers of the CCP, it's all iron bars and cold cells.

According to a report by the University of Chicago’s Paulson Institute, CCP Chinese households borrow around 32 percent of their household income in a given year, compared to US households, which borrow 81 percent.

Techies Are Trying to Get Chinese Consumers to Rack Up Debt | WIRED

Financing the Next Stage of China’s Development with Consumer Credit

Tom Orlik and Fielding Chen January 2015

China’s economy has registered a marked slowdown (see Figure 1). In 2007, GDP growth touched a high of 14.2 percent. In 2014, it may struggle to reach the government’s 7.5 percent target. That near halving of the growth rate reflects a combination of weaker global demand, diminishing returns to investment, and failure of consumption spending to pick up the slack (see Figure 2). There could be worse to come. The share of investment in China’s GDP is close to 50 percent—a nose-bleed inducing height that raises fears of overcapacity in industry and has yielded ghost towns of unsold property

http://www.goldmansachs.com/our-thinking/pages/us-china-bilateral-investment-dialogue/multimedia/papers/financing-the-next-stage-of-chinas-development.pdf

The Chinese Can’t Kick Their Savings Habit

Some bank as much as half of their income, suppressing spending

http://www.bloomberg...essing-spending

Why Are Saving Rates So High in China?*

In this paper, we define “The Chinese Saving Puzzle” as the persistently high national saving rate at 34-53 percent of gross domestic product (GDP) in the past three decades and a surge in the saving rate by 11 percentage points from 2000-2008.

http://anon-ftp.iza.org/dp5465.pdf

And the final cold hard reality of the CCP economy: Progress, however, is painfully slow. At the current rate of change it would take 140 years for private consumption to play the same role in China that it does in Japan, and 193 years for it to hit the same level as in the United States.

http://www.goldmansachs.com/our-thinking/pages/us-china-bilateral-investment-dialogue/multimedia/papers/financing-the-next-stage-of-chinas-development.pdf

Edited December 2, 2015 by Publicus

[Usernames]

Reading this topic, I'm inclined to think that TVF is where a lot of Lew Rockwell crackpots come to rant about life after they've gone broke. I guess it's a Harsh world out there.

Edited December 2, 2015 by Usernames

[Publicus]

The Mises Touched.

Wreaking Hayek everywhere they go.

As if one Austrian hadn't been enough. More than enough.

[squarethecircle]

The Mises Touched.

Wreaking Hayek everywhere they go.

As if one Austrian hadn't been enough. More than enough.

Disingenuous and unfair. Hayek composed two of the great works of the 20th century on economics and power, The Road to Serfdom and The Fatal Conceit. Chpt. 9 of Road to Serfdom, on Why The Worst Rise To The Top, alone explains just what it says.

There are plenty of academics who shamelessly advocate for reckless and destructive policies while having no skin in the game. Charlatans like Paul Krugman come to mind.

These people have calculated, "In the long run, we are wrong, but that doesn't matter because in the long run I will be dead."

Such people are the ones in need of ridicule.

Hayek in contrast left a gift to future generations with this, and I don't want anyone to see this infantile mocking and think otherwise.

[squarethecircle]

The Mises Touched.

Wreaking Hayek everywhere they go.

As if one Austrian hadn't been enough. More than enough.

Unfair. Hayek offered two of the most important books of the last century regarding economics and power: The Road To Serfdom, and The Fatal Conceit.

Chapter 9 alone of The Road To Serfdom, Why The Worst Rise To The Top, is a concise and immediately applicable description of how this happens.

In fact he left future generations this as a gift, so ridiculing him is either naive or dishonest.

There are plenty of POS academics out there who want to recklessly apply their beliefs to the world (ultimately by force) but don't put any of their own skin in the game.

This people are worthy of ridicule because they are effectively taking a massive dump on future generations and don't give a darn.

Hayek is not one of these and, again, Chapter 9 alone of Why The Worst Rise To The Top, makes that clear. Wanted to post that to clarify in case anyone sees the infantile mocking and associates that with Hayek.

Edited February 5, 2016 by squarethecircle

[Publicus]

Got ya the first time.

The Austrian school of economics are the doomsday crowd.

Heyek, Misis et al.

They believe in "pure capitalism" which must also mean they believe in the virgin Mary.

They want an apocalyptic end to the usd as the global currency, which would mean the collapse or destruction of the United States, which is of course their whole idea. Well, half of it. The other half being establish a new global order led by Beijing and Moscow and their followers in the Third World.

We're talking 21st century fascists and fascism coming out of Austria which is nothing new except the century.

Edited February 5, 2016 by Publicus

[thaibeachlovers]

The Obama administration took a step toward backing China’s bid to have the yuan recognized as a global reserve currency, as the U.S. softened its insistence that the Chinese implement financial reforms to win support.

http://www.bloomberg.com/news/articles/2015-09-25/u-s-takes-step-toward-support-for-china-s-reserve-currency-bid

Nothing in the post to include the contents of the link negates my quoted post concerning tyrant governments. The yuan would anyway join the IMF basket of reserve currencies comprised of the usd, euro, yen, pound.

There is no reason for the US to oppose including the yuan and Washington knows the fact. Nothing wrong either with applying a little leverage on the CCP Boyz in Beijing along the way, which is continuing to be done.

Yuan currently comprises 2% of global reserve forex funds and less than 2% of global trade. This does not register on the Bretton Woods scale. Yuan is not a desired or trusted currency and it now has the new risk added last month of a sudden volatility, downward especially. Recent CCP currency swap agreements with either tyrant governments or submerging emerging economies amount to nothing.

The central bank, the People's Bank of China, is not an independent central bank. It is 100% owned and operated by the Chinese Communist Party in their interests. IMF still has to get around the fact, which it can not do.

In economics and finance the CCP China is crashing in several sectors. In politics and government the CCP China is a dictatorship of tyrants.

keep up the good job ridiculing yourself with arguments drawn out of thin air and negating facts

It's another big default for the CCP Boyz in Beijing. Defaults are occurring across the CCP's economy, dropping out of thin air like a thick rain.

The Greece of the east.

China’s $7 Billion Metals Exchange ‘Ponzi’ Just Tip of the IcebergThe Fanya metals exchange can't, or won't, give investors their money—and they're likely not the only ones

Protesters against the Fanya metals exchange outside the office of the China Insurance Regulatory Commission in Shanghai on Sept. 25. Police dispersed the demonstrators protesting the company's default and who were demanding their investments back. (Johannes Eisele/AFP/Getty Images)

Fanya markets financial products called “ri jin bao,” promised fixed returns of up to 13.7 percent and guaranteed principal. According to financial news website Caixin, Fanya had stopped investor withdraws in July, freezing assets worth approximately 43 billion yuan ($6.7 billion) from 220,000 investors.

The demonstrators called Fanya a Ponzi scheme.

China Financial Derivatives Investment Research Institute estimates there are around 400 similar exchanges around the country, with 1 trillion yuan ($157 billion) in total assets. Those figures suggest there’s potential for more financial and social upheaval ahead.

http://www.chinadailyasia.com/business/2015-09/23/content_15320402.html

Two things seem to be overwhelmingly in evidence in all these types of problems- stupidity and greed.

[thaibeachlovers]

CCP economics reformers led by Xi Jinping and the English fluent PM Li Kejiang very well know they must transition the economy to a domestically driven one, that household consumption is the only way to go about it.

However, the CCP economics reformers are facing resistance from hard-core Maoists who want a pure people living in the fields. The conflict within the two CCP major factions goes back to Mao vs Deng from the founding of the PRC in 1949. Deng was alternately up and down, in and out of the inner circles, depending on which faction could get the upper hand of the moment. After Mao died, Deng finally grabbed the brass ring.

So here we are.

CCP China has a gross national savings rate of about 51 percent, according to the World Bank. In the US, it hovers around 17 percent.

(China's savings is commonly quoted between 30-35%, while the USA households around 5%.)

Maoists point to the fact the Chinese people are savers, not spenders. Yes, household consumption has increased due to the Party's unrelenting campaign the past several years to get CCP Chinese to spend. But consumption as a percentage of GDP is still half that of the US, Europe; the advanced economies.

Either way for the economics reformers of the CCP it's all uphill. For the political reformers of the CCP, it's all iron bars and cold cells.

According to a report by the University of Chicago’s Paulson Institute, CCP Chinese households borrow around 32 percent of their household income in a given year, compared to US households, which borrow 81 percent.

Techies Are Trying to Get Chinese Consumers to Rack Up Debt | WIRED

Financing the Next Stage of China’s Development with Consumer Credit

Tom Orlik and Fielding Chen January 2015

China’s economy has registered a marked slowdown (see Figure 1). In 2007, GDP growth touched a high of 14.2 percent. In 2014, it may struggle to reach the government’s 7.5 percent target. That near halving of the growth rate reflects a combination of weaker global demand, diminishing returns to investment, and failure of consumption spending to pick up the slack (see Figure 2). There could be worse to come. The share of investment in China’s GDP is close to 50 percent—a nose-bleed inducing height that raises fears of overcapacity in industry and has yielded ghost towns of unsold property

http://www.goldmansachs.com/our-thinking/pages/us-china-bilateral-investment-dialogue/multimedia/papers/financing-the-next-stage-of-chinas-development.pdf

The Chinese Can’t Kick Their Savings Habit

Some bank as much as half of their income, suppressing spending

http://www.bloomberg...essing-spending

Why Are Saving Rates So High in China?*

In this paper, we define “The Chinese Saving Puzzle” as the persistently high national saving rate at 34-53 percent of gross domestic product (GDP) in the past three decades and a surge in the saving rate by 11 percentage points from 2000-2008.

http://anon-ftp.iza.org/dp5465.pdf

And the final cold hard reality of the CCP economy: Progress, however, is painfully slow. At the current rate of change it would take 140 years for private consumption to play the same role in China that it does in Japan, and 193 years for it to hit the same level as in the United States.

http://www.goldmansachs.com/our-thinking/pages/us-china-bilateral-investment-dialogue/multimedia/papers/financing-the-next-stage-of-chinas-development.pdf

It seems that ( not only in the CCP ) the powers that rule us seek to make us economic slaves by making us buy a load of crap ( latest crap phone anyone? ) that we don't need , and if we want to save rather than spend they will ruin us with negative interest and the cashless society. Yet the sheeple go merrily to the slaughter with their head in their mobile phone communicating with their imaginary friends.

I despair for the future of the human race.

[thaibeachlovers]

Fox News is clear about its bias and revels in out, and outperforms CNN and MSNBC on a daily basis. It has a level of honesty none of the other publications mentioned here possess. Way off track but just a kind reminder this entire discussion is illegal according to PRC law. (Like the 3rd wing feminists in Canada who are trying to have someone who simply criticized feminism on Twitter arrested and placed in jail).

Being a long time Fox watcher, I surmise that much of Fox's success is down to it's policy of having attractive women in skirts ( no female pants on Fox ) presenting many of their programmes. Most of what they present is the same mind garbage as every other tv channel shoves at us so it can't be content that makes them more popular than the rest.

That and strong presenters like O Reilly make a difference. CNN- so boring I wouldn't make the effort.

However, they run so many ads that I have to make an effort to watch Fox, and it's usually over to the movie channel when the ads come on, unless it was interesting.

[thaibeachlovers]

"Transition" , not in the vocabulary of some.

"Over the last 10 to 15 years China has continued to modernize along with the flow of economic growth. At one point, China was building the equivalent of three Chicago's every year. The construction of these ghost cities, which have remained relatively empty, created a worldwide shortage of iron and rubber. Many analysts assume that since these cities have sat empty all this time that it was a clear sign of a real estate bubble in China. But nothing could be further from the truth.

The engineering of the ghost cities were a part of the National New Urbanization Plan which intends to move 100 million people from the rural population into the cities by 2020. The intent is to increase the urban population of China by 60% and create a larger consumer class as the economy shifts away from the exporting model. This will be the largest human migration in the history of the world. The economic strategies and cultural engineering used to accomplish it will be studied for generations to come."

"As the redback appreciates and is added to the SDR as one of the reserve currencies making up the basket, China will be looking at ways of expanding existing services and creating new ones. These services consist of financial services (think Eurozone bailout and McDonald's bonds), communications, transportation into international markets and regions, promoting tourism, and the exporting of media and traditional Chinese values and heritage.

Chinese economic strategists have a set a target of reaching $1 trillion of Trade Services by 2020, the same year in which the urbanization plan is set to include 60% of the population. This is a dramatic shift away from the policy of exporting goods which carried the growth of the Chinese economy for decades."

http://philosophyofmetrics.com/wp-content/uploads/2015/11/The-Economic-Transition-Papers-Re-Engineering-the-Dollar.pdf

And, what will these 100 million do to earn money to create this consumer society? Given that the poor have limited education and no skills beyond factory work or farming they can't all of a sudden become skilled. The not poor already live in cities.

[thaibeachlovers]

It is not that strange, it was national policy for some not that long ago. They just cannot let go and embrace a wider picture.

As you say China has a heritage and culture going back thousands of years but their way of life and values are mainly criticised by those that have no real history of their own.

Anyone who wants the history of the past 3000 years in China or anywhere else can have it.

Just don't try to take the modern world back there with you. CCP are revanchist and irredentist.

The modern world is moving forward. Even the Chinese people don't like that their government, its politics, economics, financial system, society, is based on a mid-19th century German eccentric Jewish European guy and his rich benefactor in England. It's yet another boneheaded thing that keeps China in the losers bracket of history right up to the present.

Many Chinese don't like the Lenin part of it either. As for Mao, even the CCP teaches in all the schools and at party meetings Mao was 70% right. We know that's 100% wrong....and then some. Deng doesn't look so good any more either. That's true on the mainland, but Deng never looked good in Hong Kong. All of 'em are viewed from Taiwan as another bunch in a long line of loser autocrats.

The Chinese are pragmatic about governments and politics ...like I say for fiery speeches on government join in a closed family group and their discussions there rival any American stuff on TV ...they just don't like to go public about their views

Chinese don't like their government but unlike the west as long as it serves a purpose and doesn't do too much damage to their personal lives most Chinese an empathetic to just let it function

Ranting on TV and wanting a voice etc is very western and may not be right / wrong ...just doesn't appeal to the Chinese to do that ...so stop painting the Chinese like they are oppressed or something ...they have a way to vent their views ...it's in a private forum

I am proud of my heritage and the 5000 year history ...when some posters here can read calligraphy and Chinese poems I believe they are in a position to critic the nature of it until then ...it's hot air keyboard hubris

I know it's not the easiest language to learn unlike English ...sorry

There are many cultures throughout the world that have a long history of keeping your mouth shut publicly. It's sometimes an unwritten rule. Written or unwritten, break the rule and one can literally lose your tongue and maybe lose your family too. In the CCP China the rule is a written one. It shouts in huge letters/characters. CCP are a censoring fascist dictatorship. A twenty-first century fascism.

There is nothing unique, precious or commendable about a dictatorship and its punishing censorship in a one party state where only emperors have ruled for thousands of years. Contemporary emperors who rule in business suits are nothing unique or precious. CCP is a young and nervous dynasty, terrified of any criticism or critique. They are indefensible.

It is likewise arbitrary to set standards others can't ordinarily meet in order specifically to set up the others to fail. Calligraphy and Chinese poems in their native Chinese are not for everyone. They are unique to China, which makes it impossible to require anyone who has a critique or criticism of the place to know either or both....or anything else uniquely Chinese. To require or suggest it is absurd and a summary judgement presumed legitimate from on high.

No one here has demanded a Chinese person discuss Walt Whitman, or the versatile writing styles of Mark Twain (S. Clemens), or uniquely American jazz music. Or to discuss a George Rockwell painting as prerequisite to criticising democracy or American society, culture, government, its founders, leaders, great achievements. For a young country, the United States has a lot of history. Older than its years, as people say.

Lao Tzu is universally regarded as a genius of military strategy and tactics, but no Chinese general has ever applied him successfully or adeptly. No Chinese general has won a great war whether the general and his sad army of Chinese did or did not fire a shot.

The CCP Dictators in Beijing are hardly practical as they disrespect success while they believe their own country's sad history necessarily makes them masters of the universe. Their crumbling and collapsing economy prove their incompetence. Their actions in SCS prove the CCP are indeed klutzes.

If you are correct in all your ramblings it is a very bad thing for all of us as a desperate government has usually attempted to achieve prosperity by looting other countries. If that happens with China, it would make WW2 look like a Sunday school picnic.

[LawrenceChee]

The hordes of Chinese shopping at central festival gives me hope that consumerism will help spurt growth... a slower one

[sandyf]

"Transition" , not in the vocabulary of some.

"Over the last 10 to 15 years China has continued to modernize along with the flow of economic growth. At one point, China was building the equivalent of three Chicago's every year. The construction of these ghost cities, which have remained relatively empty, created a worldwide shortage of iron and rubber. Many analysts assume that since these cities have sat empty all this time that it was a clear sign of a real estate bubble in China. But nothing could be further from the truth.

The engineering of the ghost cities were a part of the National New Urbanization Plan which intends to move 100 million people from the rural population into the cities by 2020. The intent is to increase the urban population of China by 60% and create a larger consumer class as the economy shifts away from the exporting model. This will be the largest human migration in the history of the world. The economic strategies and cultural engineering used to accomplish it will be studied for generations to come."

"As the redback appreciates and is added to the SDR as one of the reserve currencies making up the basket, China will be looking at ways of expanding existing services and creating new ones. These services consist of financial services (think Eurozone bailout and McDonald's bonds), communications, transportation into international markets and regions, promoting tourism, and the exporting of media and traditional Chinese values and heritage.

Chinese economic strategists have a set a target of reaching $1 trillion of Trade Services by 2020, the same year in which the urbanization plan is set to include 60% of the population. This is a dramatic shift away from the policy of exporting goods which carried the growth of the Chinese economy for decades."

http://philosophyofmetrics.com/wp-content/uploads/2015/11/The-Economic-Transition-Papers-Re-Engineering-the-Dollar.pdf

And, what will these 100 million do to earn money to create this consumer society? Given that the poor have limited education and no skills beyond factory work or farming they can't all of a sudden become skilled. The not poor already live in cities.

Probably the same as the UK when they lost their manufacturing base. many foreign manufacturers now have plants in the UK.

China already has an Airbus factory and about to open another, Boeing is now knocking at the door. Life goes on.

Edited February 12, 2016 by sandyf

[thaibeachlovers]

"Transition" , not in the vocabulary of some.

"Over the last 10 to 15 years China has continued to modernize along with the flow of economic growth. At one point, China was building the equivalent of three Chicago's every year. The construction of these ghost cities, which have remained relatively empty, created a worldwide shortage of iron and rubber. Many analysts assume that since these cities have sat empty all this time that it was a clear sign of a real estate bubble in China. But nothing could be further from the truth.

The engineering of the ghost cities were a part of the National New Urbanization Plan which intends to move 100 million people from the rural population into the cities by 2020. The intent is to increase the urban population of China by 60% and create a larger consumer class as the economy shifts away from the exporting model. This will be the largest human migration in the history of the world. The economic strategies and cultural engineering used to accomplish it will be studied for generations to come."

"As the redback appreciates and is added to the SDR as one of the reserve currencies making up the basket, China will be looking at ways of expanding existing services and creating new ones. These services consist of financial services (think Eurozone bailout and McDonald's bonds), communications, transportation into international markets and regions, promoting tourism, and the exporting of media and traditional Chinese values and heritage.

Chinese economic strategists have a set a target of reaching $1 trillion of Trade Services by 2020, the same year in which the urbanization plan is set to include 60% of the population. This is a dramatic shift away from the policy of exporting goods which carried the growth of the Chinese economy for decades."

http://philosophyofmetrics.com/wp-content/uploads/2015/11/The-Economic-Transition-Papers-Re-Engineering-the-Dollar.pdf

And, what will these 100 million do to earn money to create this consumer society? Given that the poor have limited education and no skills beyond factory work or farming they can't all of a sudden become skilled. The not poor already live in cities.

Probably the same as the UK when they lost their manufacturing base. many foreign manufacturers now have plants in the UK.

China already has an Airbus factory and about to open another, Boeing is now knocking at the door. Life goes on.

If either Bernie or the Donald wins the presidency that may not happen re Boeing. No wonder Euro has an unemployment problem allowing that. Still, as long as the 1% get rich, screw the rest of us.

[squarethecircle]

Got ya the first time.

The Austrian school of economics are the doomsday crowd.

Heyek, Misis et al.

They believe in "pure capitalism" which must also mean they believe in the virgin Mary.

They want an apocalyptic end to the usd as the global currency, which would mean the collapse or destruction of the United States, which is of course their whole idea. Well, half of it. The other half being establish a new global order led by Beijing and Moscow and their followers in the Third World.

We're talking 21st century fascists and fascism coming out of Austria which is nothing new except the century.

Well this unfair, but in case anyone is listening to what appears to be an outright fabrication:

In fact the Austrians are the Darwinians of economics: they point out that, quite rightly, all advanced economies function as the "sum is greater than the whole" product of millions of individuals working in their own self-interest.

And I challenge anyone person to find an honest counterexample to the point made in Chapter 9 of The Road to Serdom: how and why the worst rise to the top. It applies equally well the world over.

[thaibeachlovers]

Got ya the first time.

The Austrian school of economics are the doomsday crowd.

Heyek, Misis et al.

They believe in "pure capitalism" which must also mean they believe in the virgin Mary.

They want an apocalyptic end to the usd as the global currency, which would mean the collapse or destruction of the United States, which is of course their whole idea. Well, half of it. The other half being establish a new global order led by Beijing and Moscow and their followers in the Third World.

We're talking 21st century fascists and fascism coming out of Austria which is nothing new except the century.

Well this unfair, but in case anyone is listening to what appears to be an outright fabrication:

In fact the Austrians are the Darwinians of economics: they point out that, quite rightly, all advanced economies function as the "sum is greater than the whole" product of millions of individuals working in their own self-interest.

And I challenge anyone person to find an honest counterexample to the point made in Chapter 9 of The Road to Serdom: how and why the worst rise to the top. It applies equally well the world over.

I haven't read it, but from personal experience I know that managers in public service institutions like the British NHS are pretty BAD. They choose public service because they'd never be able to do a real job, and in the government morass it's almost impossible to be fired, though most of them should be.

[Publicus]

 

Got ya the first time.

The Austrian school of economics are the doomsday crowd.

Heyek, Misis et al.

They believe in "pure capitalism" which must also mean they believe in the virgin Mary.

They want an apocalyptic end to the usd as the global currency, which would mean the collapse or destruction of the United States, which is of course their whole idea. Well, half of it. The other half being establish a new global order led by Beijing and Moscow and their followers in the Third World.

We're talking 21st century fascists and fascism coming out of Austria which is nothing new except the century.

Well this unfair, but in case anyone is listening to what appears to be an outright fabrication:

In fact the Austrians are the Darwinians of economics: they point out that, quite rightly, all advanced economies function as the "sum is greater than the whole" product of millions of individuals working in their own self-interest.

And I challenge anyone person to find an honest counterexample to the point made in Chapter 9 of The Road to Serdom: how and why the worst rise to the top. It applies equally well the world over.

The road to serfdom begins at one end of the CCP China and it ends at its far end. The CCP China is after all a so called "emerging economy." The CCP China is not an advanced economy. It is simply a big economy. Its income distribution and its political system constitute the 21st century definition of serfdom.

So now surprise of all surprises comes "supply side" economics to the CCP following the December Economics Working Conference of the CCP Central Committee led by Xi Jinping. Given the big flop failure of the reform efforts of Xi and his PM the English fluent Li Kejiang, the CCP has lo and behold now turned to, well, Reaganomics.

Here is the highly acclaimed Michael Pettis, professor of finance at Peking University in Beijing, whose consistent brilliance on the CCP economy and its financial systems have made him a finalist for the Nobel Prize...

"With the end of the Central Economic Work Conference last December, Beijing has announced with some fanfare that it plans to design and implement a new reform program consisting of what are being called supply-side policies.

"A new reform program would seem only to be necessary if the old one has failed or is failing. It does seem to have failed.

"The important news for me has been the announcement of the new reforms and the form of the announcement. Analysts are still very uncertain about what this new package of supply-side reforms that weve been hearing about since at least November may entail, but the way in which the reform package was announced suggests, at least to me, that the leadership is no longer satisfied that the policies Beijing has been pursuing during the past three years are having the intended effect."

http://www.economist.com/node/21006933/contributors/Michael%20Pettis

It is immediately obvious Prof Pettis has in his recognised genius a certain tendency toward the understatement. The arrival of supply side Reaganomics in the calculus of the CCP is sort of like Ronald Reagan standing there resonating in his best voice, "Mr. Xi Jinping, take down this Great Wall." Trouble for CCP is that, as with Gorbechev and his beloved Soviet Union, it is already too late for the Boyz of Beijing.

The Boyz had spent the past 25 years rushing OTT with their demand side infrastructure construction, cheap manufacuring, massive exports, purchase of US Treasuries to allow the gross undevaluation of the yuan, massive corruption, humongous debt which is four times GDP growth by their own grossly inflated data and so on. Now that the Boyz have as the consequence created a massive ovrcapacity and humongous oversupply, the Boyz have decided the correct approach is to create -- more supply.

Reaganomics now suddenly entering the CCP China = Game Over.

Prof Pettis now advises not to expect a soft landing of the CCP economy or a hard landing either, disappointing each side of the long ongoing argument. We should instead expect a "long landing." In other words, a slow, painful and agonising one in which unemployment must increase, debt must be paid and credit growth must become less than the recent paltry GDP growth.

In short, "The two important points if I am right, then, are, first, that during the adjustment a sharp slowdown in growth is inevitable, and is embedded within the rebalancing process, and second, that until the debt is specifically addressed, efficiency-improving reforms will never be enough to resolve the rebalancing process. Growth in other words will continue to decline substantially no matter what Beijing does."

Translation: Bang the drum slowly.

Edited February 18, 2016 by Publicus