Chinese Economics Thread

[bajingan]

Agreed? The problem is that the Americans are planning to export their problems to the rest of the world. They are essentially doing a "I will take you all down with me" thing

I agree with you, such is the mentality of the americans, if they lose their largest economy status to China, they would rather burn the whole world down, they felt like this is the world that we built, if we lose control of it, we might as well burn it down
They are the worst egomaniac, the lot of them

 

[caudaceus]

I agree with you, such is the mentality of the americans, if they lose their largest economy status to China, they would rather burn the whole world down, they felt like this is the world that we built, if we lose control of it, we might as well burn it down
They are the worst egomaniac, the lot of them

Might that be the reason China is tightening? The tightening is quite severe, Huarong asset management is in peril(?) even the chairman got a swift death penalty.
Recall Buffet's saying "Only when the tide goes out do you discover who's been swimming naked". Seems China is deliberately lowering the tide and sweep up who are naked (lol).
In addition, maybe they also believe this "Tighten when other loosening, loosen when other tightening".

 

[voyager1]

Huarong asset management is in peril

*was in peril. Until they magically found around 400 mln dollars to finance their debt on end of April. (There are some others this + next week, but the markets has calmed down a bit).

How did they find this money?.. Maybe from the State? lol. No normal primate business would loan them at that time

 

[Tyler]

Given how much money the US government is printing, it is feasible for them to recover all the pre-COVID losses this year.
But that is storing up trouble in the future with regards to inflation and US reserve currency status.

At the end of 2019, US national debt was $22 Trillion
It's currently at $28 Trillion, and I reckon it will be over $30 Trillion by the end of 2021.

With so much $US being printed, how come the US stock market is not going up? Many stocks are just going up and down like a yoyo. Investors need a clear path to the upside before they can invest with confidence. Looks like a lot of money is gong into the bitcoin scam.

 

[AndrewS]

Might that be the reason China is tightening? The tightening is quite severe, Huarong asset management is in peril(?) even the chairman got a swift death penalty.
Recall Buffet's saying "Only when the tide goes out do you discover who's been swimming naked". Seems China is deliberately lowering the tide and sweep up who are naked (lol).
In addition, maybe they also believe this "Tighten when other loosening, loosen when other tightening".

PEW research paper below on incomes in China and India.

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If you cut through all the crap and redo the numbers, the following groups in China actually increased in numbers during 2020.

High income
Upper-Middle income
Middle income

The number of people on low incomes decreased.
And the numbers of poor remained the same.

Of course, prior to COVID, the projections were for much better economic performance.

So yes, the Chinese government doesn't need excessive stimulus to keep the economy going, particularly since there is a lot of pent up savings in China. A consumer boom awaits over the next 6 months.

 

[AndrewS]

With so much $US being printed, how come the US stock market is not going up? Many stocks are just going up and down like a yoyo. Investors need a clear path to the upside before they can invest with confidence. Looks like a lot of money is gong into the bitcoin scam.

Look at the S&P500.

Prior to COVID it was at 3300. Now it is 4100. That is up 24%.

If that 24% is representative of broader listed stocks, then the combined US stock market capitalisation has increased from $40 trillion to $50 trillion.

But the S&P500 dividend yield is only 1.38% which is near historic lows.
So arguably stocks are overpriced.


Dividend yield below.

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[Deleted member 15949]

Look at the S&P500.

Prior to COVID it was at 3300. Now it is 4100. That is up 24%.

If that 24% is representative of broader listed stocks, then the combined US stock market capitalisation has increased from $40 trillion to $50 trillion.

But the S&P500 dividend yield is only 1.38% which is near historic lows.
So arguably stocks are overpriced.


Dividend yield below.

View attachment 70994

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Stonks are fine and money printing is risk free because there is no inflation. In fact, money printing only has upside risk: GDP growth, financial inclusion & higher asset prices

 

[voyager1]

Stonks != real economy. The stonk market is disconnected from the real economy, people are going to the food banks and there is an eviction ban currently in the US

Its all the printing that pushes Stonks closer and closer to the Moon

 

[AndrewS]

Stonks are fine and money printing is risk free because there is no inflation. In fact, money printing only has upside risk: GDP growth, financial inclusion & higher asset prices

Inflation takes 6-12 months to kick in after the money printing.

And there are still going to be significant disruptions to production and logistics for the next 6 months at least.

The inflation is coming. The only question is how much

 

[voyager1]

Inflation takes 6-12 months to kick in after the money printing.

And there are still going to be significant disruptions to production and logistics for the next 6 months at least.

The inflation is coming. The only question is how much

The debate that the US has now is if the inflation is going to be temporary or permanent

Obviously the FED is pushing the temporary option. And they say that it will happen for a few months only because of the disruption of the supply chain (true). So there is a lot of demand but less supply available due to closed factories, shipping delays, etc.

However they are forgetting that the commodities prices are on the roof and they wont come down any time soon.

They will just "hide" the inflation from their CPI metric and the poor will become poorer, and the rich will become richer..