American Economics Thread

[weig2000]

China's economy didn't grow at an 18% annual rate between the fourth quarter of 2020 and the first quarter of 2021. Rather, it was 18% larger in the first quarter of 2021 compared to the first quarter of 2020. This is how China always reports its numbers and always has. It reports it every quarter, but it reports it at an annual rate. News reports sometimes use the word "quarterly" but what they are referring to is a year-over-year figure.

The US reports differently. The 6.4% isn't saying the economy was 6.4% bigger in Q1 2021 compared to a year ago. It's saying it grew at a 6.4% annual rate for the quarter Q1 2021 compared to Q4 2020, or that it was 1.6% bigger in the Q1 this year compared to the previous quarter, since 1.6 x 4 = 6.4. This is how the US always reports it as well.

What was China's actual quarterly growth?

When compared with the last three months of 2020, the Chinese economy expanded just 0.6% in the first quarter of 2021, slowing from a newly revised 3.2% quarter-on-quarter GDP increase in the fourth quarter of 2020, according to data released Friday by the National Bureau of Statistics.”

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The 0.6% quarter-on-quarter growth x4 is 0.6 x 4 or 2.4% at an annual rate. This 2.4% is what compares directly with the 6.4% US figure.

The 0.6% growth rate is coming after a very strong Q4 2020 growth rate (6.5% YOY, 2.6% QOQ), which is more than the 6% YOY growth rate of Q4 2019.

In any case, China's growth is back to normal now. Q1 2021 has a very high YOY growth rate because of the negative rate of Q1 2020. The entire 2021 will have a higher than normal YOY growth rate (8-10%) because of last year's low base. So China will not only be back to normal, but also recoup some of the loss of growth last year. That's more than you can say for most other economies in the world. That's all. The western media don't feel good about this and just try to spin the numbers to paint a different picture.

 

[manqiangrexue]

China's economy didn't grow at an 18% annual rate between the fourth quarter of 2020 and the first quarter of 2021. Rather, it was 18% larger in the first quarter of 2021 compared to the first quarter of 2020. This is how China always reports its numbers and always has. It reports it every quarter, but it reports it at an annual rate. News reports sometimes use the word "quarterly" but what they are referring to is a year-over-year figure.

The US reports differently. The 6.4% isn't saying the economy was 6.4% bigger in Q1 2021 compared to a year ago. It's saying it grew at a 6.4% annual rate for the quarter Q1 2021 compared to Q4 2020, or that it was 1.6% bigger in the Q1 this year compared to the previous quarter, since 1.6 x 4 = 6.4. This is how the US always reports it as well.

What was China's actual quarterly growth?

When compared with the last three months of 2020, the Chinese economy expanded just 0.6% in the first quarter of 2021, slowing from a newly revised 3.2% quarter-on-quarter GDP increase in the fourth quarter of 2020, according to data released Friday by the National Bureau of Statistics.”

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The 0.6% quarter-on-quarter growth x4 is 0.6 x 4 or 2.4% at an annual rate. This 2.4% is what compares directly with the 6.4% US figure.

Ohhhh that's unbelievable! The USA so powerful! We underestimated it but now we know we cannot challenge it... We must do whatever we can to improve relations! Please, help us!

Is this the reaction your falun gong propaganda wanted? You know, when you BS, you have to make it believable. I was gonna just let it slide until I saw your conclusion that China is at 2.4% and the US at 6.4%! If you made it look like China came up ahead by just a bit, I would have been too lazy to check, but even in this economic roller coaster, having the US more than double China is not believable. So here we go:

Here is a fair comparison between the economic growths of China and the US when calculated at an annualized rate. All growth is calculated from the same quarter of the previous year.

China:

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Take home point: "The Chinese economy advanced 18.3 percent year-on-year in the March quarter 2021, accelerating sharply from a 6.5 percent growth in the fourth quarter and compared with market consensus of 19 percent. "

Summary: China's economy declined by 6.8% in Q1 of 2020 and then for every quarter showed accelerating growth.
Numbers to compare: -6.8%, 3.2%, 4.9%, 6.5%, 18.3%.

USA:

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Take home point: "The Gross Domestic Product (GDP) in the United States expanded 0.40 percent in the first quarter of 2021 over the same quarter of the previous year. source: U.S. Bureau of Economic Analysis"

The American economy held onto 0.3% growth in Q1 2020 then declined for three consecutive quarters starting from Q2 2020 and then rebounded to slight 0.4% growth in Q1 2020.
Numbers to compare: 0.3%, -9%, -2.8%, -2.4%, 0.4%.

 

[gadgetcool5]

Ohhhh that's unbelievable! The USA so powerful! We underestimated it but now we know we cannot challenge it... We must do whatever we can to improve relations! Please, help us!

Is this the reaction your falun gong propaganda wanted? You know, when you BS, you have to make it believable. I was gonna just let it slide until I saw your conclusion that China is at 2.4% and the US at 6.4%! If you made it look like China came up ahead by just a bit, I would have been too lazy to check, but even in this economic roller coaster, having the US more than double China is not believable. So here we go:

Here is a fair comparison between the economic growths of China and the US when calculated at an annualized rate. All growth is calculated from the same quarter of the previous year.

China:

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Take home point: "The Chinese economy advanced 18.3 percent year-on-year in the March quarter 2021, accelerating sharply from a 6.5 percent growth in the fourth quarter and compared with market consensus of 19 percent. "

Summary: China's economy declined by 6.8% in Q1 of 2020 and then for every quarter showed accelerating growth.
Numbers to compare: -6.8%, 3.2%, 4.9%, 6.5%, 18.3%.

USA:

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Take home point: "The Gross Domestic Product (GDP) in the United States expanded 0.40 percent in the first quarter of 2021 over the same quarter of the previous year. source: U.S. Bureau of Economic Analysis"

The American economy held onto 0.3% growth in Q1 2020 then declined for three consecutive quarters starting from Q2 2020 and then rebounded to slight 0.4% growth in Q1 2020.
Numbers to compare: 0.3%, -9%, -2.8%, -2.4%, 0.4%.

That's not fair and you know it. China's worse quarter was Q1 while the US's worst quarter was Q2 so looking at year on year percentages you'll have to wait until this quarters results are out to compare.

The reality is strictly looking at the first quarter compared to the previous one, the 6.4% to 2.4% is accurate.

 

[manqiangrexue]

That's not fair and you know it.

Oh it's fair alright. Look at the trends for 5 quarters calculated the same way and you say it's not fair. You want us to take a look at what YOU calculated for the US, which does Quarter on Quarter vs. China's Year on Year, for one point. No... no data manipulation accepted.

China's worse quarter was Q1 while the US's worst quarter was Q2 so looking at year on year percentages you'll have to wait until this quarters results are out to compare.

You're right on that, BUT what are we gonna compare? 18.3% is China's big quarter; compared to America's current, it is 17.9% ahead; basically, it stood about even to the US with just what it had behind the decimal point. America's next quarter is its big one; I think it might even be a bit higher than China's next one, but if you subtract the 17.9% deficit it is taking from this quarter, America will be well behind again.

The reality is strictly looking at the first quarter compared to the previous one, the 6.4% to 2.4% is accurate.

It's only accurate for Epoch Times. The reality is looking at the same comparison methods between the two countries, which is year on year. It is the comparison that is used to parry seasonal fluctuations. If you want to compare Q1 2021 vs Q4 2020, that's fine too. China's numbers are 6.5 into 18.3 while the US went from -2.4% to 0.4%. You know damn well if you were to choose which of these 2 number sets you want to be yours, you're choosing China's.

This is the accurate reality:
PRC: -6.8%, 3.2%, 4.9%, 6.5%, 18.3%
USA: 0.3%, -9%, -2.8%, -2.4%, 0.4%

We can wait for one more data point to come out in Q2 2021 and it'll likely pull the score a little more even but what's up there is the current score and that data point will be nowhere near sufficient to level out 18.3% vs 0.4% deficit the US took in Q1 2021 not to mention from all the numbers preceding.

 

[gadgetcool5]

It's only accurate for Epoch Times. The reality is looking at the same comparison methods between the two countries, which is year on year. It is the comparison that is used to parry seasonal fluctuations. If you want to compare Q1 2021 vs Q4 2020, that's fine too. China's numbers are 6.5 into 18.3 while the US went from -2.4% to 0.4%. You know damn well if you were to choose which of these 2 number sets you want to be yours, you're choosing China's.

No, it's accurate period. Since the quarter on quarter method is also the same comparison methods between the two countries.

Both the quarter on quarter AND year on year methods are the same comparison methods, just over a different time frame. Year on year makes China look better whereas quarter on quarter makes the US look better. So why not use year on year?

Because, as I said, a year on year is misleading due to China's low base in Q1 2020. Whereas the US low base is not until Q2 2020. So even though statistically it's the same method yes, but it's still distorted.

Quarter on quarter is ALSO the same statistical method for both countries, but in this case it's not as distorted, since both countries' worst Covid crisis was over by Q4 2020. Hence that's why I chose Q on Q instead of Y on Y.

Edit: Also, let me say, NO ONE is disputing that China's economic performance over the 2-year period is better. My original point was just that the 18% vs. 6% comparison is wrong because one is YoY and the other is QoQ, and a QoQ comparison is 6.4% to 2.4%. My point was not that the US economy is growing faster overall, just to make a technical correction to AssasinsMace's comment, since it was a reply to my post. But it's not remarkable since China's economy has been growing faster for decades as it's a developing economy. Nothing surprising there. The surprising thing is that China's growth was only 2.4% in Q1 after it supposedly already recovered from Covid-19. That is the slowest quarterly growth for a decade (excluding Covid).

 

[j17wang]

Which Chinese knife brands do you recommend? I'm in the market for some new knives. Thanks!

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These are sold online and also through Costco. They don't come cheap, but quality is not cheap.

 

[manqiangrexue]

No, it's accurate period.

Mine is accurate, and you're on your period.

Since the quarter on quarter method is also the same comparison methods between the two countries.

I just showed you the year on year comparison between the two countries.

Both the quarter on quarter AND year on year methods are the same comparison methods, just over a different time frame. Year on year makes China look better whereas quarter on quarter makes the US look better. So why not use year on year?

Because, as I said, the year on year method parries seasonal differences such as Chinese New Years or shopping season. If you're not disputing that China's overall economic performance is superior, then using a method that makes it appear as though the US is doing better is disingenuous and manipulating data.

Because, as I said, a year on year is misleading due to China's low base in Q1 2020. Whereas the US low base is not until Q2 2020. So even though statistically it's the same method yes, but it's still distorted.

So as I said, keep all the data points I showed, then wait for the next one. China's still on top.

Quarter on quarter is ALSO the same statistical method for both countries, but in this case it's not as distorted, since both countries' worst Covid crisis was over by Q4 2020. Hence that's why I chose Q on Q instead of Y on Y.

China's was over by Q2 2020. You chose a method that would make China's early emergence from COVID actually lower its growth numbers for a single point and couple that with the Lunar New Year vacation.

Edit: Also, let me say, NO ONE is disputing that China's economic performance over the 2-year period is better.

Then choosing to do analysis in any way to make it look the reverse is disingenuous and manipulating data.

My original point was just that the 18% vs. 6% comparison is wrong because one is YoY and the other is QoQ, and a QoQ comparison is 6.4% to 2.4%. My point was not that the US economy is growing faster overall, just to make a technical correction to AssasinsMace's comment, since it was a reply to my post. But it's not remarkable since China's economy has been growing faster for decades as it's a developing economy. Nothing surprising there. The surprising thing is that China's growth was only 2.4% in Q1 after it supposedly already recovered from Covid-19. That is the slowest quarterly growth for a decade (excluding Covid).

This is why people don't do quarter on quarter for China. Chinese New Year is in Q1, so with the time off, you cannot compare it to Q4 of last year when everyone was working the entire time. Now you think the number is oddly low; maybe it is; maybe it's not. To find out, you need to compare it with the Q1 vs previous Q4 of China's prior years. If you truly want to do quarter on quarter comparison then you need to bring up a chart of China's quarter on quarter growth for the last few (10 preferable, at least 5) years but China doesn't calculate like that because it does year on year to avoid the seasonal fluctuation.

 

[Xizor]

US economy saw a decrease of 1.5 trillion from Q1 2020 to Q4 2020.

Chinese economy saw an increase of around 1.2 trillion from Q1 2020 to Q4 2020.

 

[voyager1]

US economy saw a decrease of 1.5 trillion from Q1 2020 to Q4 2020.

Chinese economy saw an increase of around 1.2 trillion from Q1 2020 to Q4 2020.

Lets also not forget the printing of dollars

American people will soon learn what is inflation when the prices of goods increase and their wages remain stagnant or even decline..

 

[Xizor]

Lets also not forget the printing of dollars

American people will soon learn what is inflation when the prices of goods increase and their wages remain stagnant or even decline..

Not necessarily. American corporations can service government bonds and the government will use this cash.

I admit I have no graduate degree in economics but the way I understand, it is Corporations that shoulder the burden of the latest "printing spree". So not necessarily inflation in the long term.

But what the corporations do with the bonds purchased is the question. Aren't bonds, in a way, a way to store Capital long term? Why would they do it if the future economy is boom?

Figuratively, bonds are a measure of long term stability of a country. And Interest rates are low because Fed sees less risk and need of more support for Companies.Both point to good future for US next five years or more.
Not at all gloom.

(I may be wrong.I'd like to figure out)