Chinese Economics Thread

[voyager1]

@voyager1 bro question what scares the American the most a military confrontation or a financial meltdown? Right now Biden had just publicly stated that they want a dialogue with Russia, stating regret about the sanction and wanted a rapprochement.

Biden is full of bs. He just sanctioned Russia's ability to raise money by bonds (US financial institutions cant hold Russia's bet). Next step after this IMO, is a total ban on raising money by dollars

Biden has actually just declared economic war against Russia now. Give it some years and he will ban dollar bonds to them. Russia has only a few years available now (if Biden decides to fully sanction them).

I am expecting Putin to come to Xi for help. Time for China to finally get real influence in Central Asia and displace Russia from there

 

[Sincho]

@Sincho totally agree and welcome to SDF bro, but it is already happening as @gelgoog had already posted, Digital Yuan is the future, Alipay and Wechat pay will fall under it and CHN gov't with supervise it. In the era of intense China and US competition, the first target will be financial, what holding them back is that they needed each other, its their Achilles Heel. Digital Yuan will be China way of breaking the deadlock and also an answer to American sanction. The calmness of CCP belied the plan action, the Rubicon haven't cross yet (Taiwan issue), if it does, it will devastated the American financial system, the American knows it and therefore the pressure for the Chinese to submit and compromised.

With the advent of the digital Yuan, the exact mechanism involved in the payment system that is Alipay and WeChat Pay will change but this does not mean that the organisations that are Alipay and WeChat Pay need to be nationalized. We will still need Alipay/WeChat Pay to service e-commerce payment as agent for escrow and as intermediary to effect the transfer.

 

[ansy1968]

Biden is full of bs. He just sanctioned Russia's ability to raise money by bonds (US financial institutions cant hold Russia's bet). Next step after this IMO, is a total ban on raising money by dollars

Biden has actually just declared economic war against Russia now. Give it some years and he will ban dollar bonds to them. Russia has only a few years available now (if Biden decides to fully sanction them).

I am expecting Putin to come to Xi for help. Time for China to finally get real influence in Central Asia and displace Russia from there

@voyager1 but bro Russia is self sufficient and had little foreign debts, what I know is that American investors want to buy Russian Bonds cause they can earn money instead of negative interest rate in the west. Like Trump sanction on Chinese tech, it was a way for the American company to decouple from China. They want their banks and investors to buy US treasury notes instead.

 

[ansy1968]

With the advent of the digital Yuan, the exact mechanism involved in the payment system that is Alipay and WeChat Pay will change but this does not mean that the organisations that are Alipay and WeChat Pay need to be nationalized. We will still need Alipay/WeChat Pay to service e-commerce payment as agent for escrow and as intermediary to effect the transfer.

@Sincho correct bro, glad we're on the same page, Alipay and Wechat pay both had foreign investors owning a lot of shares compromising financial security, I think the recent $2.5 billion fine on Alibaba is a sign that gov't acknowledge its role, but as it become to big it needed to be regulated.

 

[voyager1]

@voyager1 but bro Russia is self sufficient and had little foreign debts, what I know is that American investors want to buy Russian Bonds cause they can earn money instead of negative interest rate in the west. Like Trump sanction on Chinese tech, it was a way for the American company to decouple from China. They want their banks and investors to buy US treasury notes instead.

The real problem for Russia was that it blocked them for making emergency bond raises because if it went to war against Ukraine, the West would sanction it Very Hard and its economy would tank.

So combining a tanked economy(sanctions) and huge increases in military expenditures, Russia would be forced to frequently raise money by bonds to finance their expenditures. With the whole world scared to lend them money, Russia would be left alone for raising such huge sums of money.

In that case, Putin will eventually turn to China for a loan. And China is not a charity, it would suck Russia's blood for this kind of favour.

This is a complex matter but IMO it mostly sets the stage for an eventual dollar bond ban and for deterring Russia from attacking Ukraine.

 

[Sincho]

@Sincho correct bro, glad we're on the same page, Alipay and Wechat pay both had foreign investors owning a lot of shares compromising financial security, I think the recent $2.5 billion fine on Alibaba is a sign that gov't acknowledge its role, but as it become to big it needed to be regulated.

I am not complaining about the need to regulate where there's a need to such as it's monopolistic practices which need to be broken up so that new non-established companies have a chance to enter the business i.e. to level the playing field for new entrants. But that is different from nationalizing.

 

[Andy1974]

The real problem for Russia was that it blocked them for making emergency bond raises because if it went to war against Ukraine, the West would sanction it Very Hard and its economy would tank.

So combining a tanked economy(sanctions) and huge increases in military expenditures, Russia would be forced to frequently raise money by bonds to finance their expenditures. With the whole world scared to lend them money, Russia would be left alone for raising such huge sums of money.

In that case, Putin will eventually turn to China for a loan. And China is not a charity, it would suck Russia's blood for this kind of favour.

This is a complex matter but IMO it mostly sets the stage for an eventual dollar bond ban and for deterring Russia from attacking Ukraine.

Maybe China would ask for a little bit of land just south of Vladivostok.

 

[KYli]

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[NiuBiDaRen]

Maybe China would ask for a little bit of land just south of Vladivostok.

Look we get what you're trying to say, but south of Vladivostok is the sea.

 

[hkbc]

The real problem for Russia was that it blocked them for making emergency bond raises because if it went to war against Ukraine, the West would sanction it Very Hard and its economy would tank.

So combining a tanked economy(sanctions) and huge increases in military expenditures, Russia would be forced to frequently raise money by bonds to finance their expenditures. With the whole world scared to lend them money, Russia would be left alone for raising such huge sums of money.

In that case, Putin will eventually turn to China for a loan. And China is not a charity, it would suck Russia's blood for this kind of favour.

This is a complex matter but IMO it mostly sets the stage for an eventual dollar bond ban and for deterring Russia from attacking Ukraine.

So much mis-information

• Russia doesn't hold any US bonds dumped it all for gold years ago, been trying to persuade the Chinese to do the same for years
• The Russian economy has held up surprisingly well despite several rounds of Sanctions and a drop in oil prices. The economy diversified because of European Sanctions its now able to feed the population only needing to import beef and fresh vegetables and they've rebuilt their industrial supply chains excluding Ukrainian imports. Putin is on record as saying he was uneasy about the European sanctions at first but surprised how well Russia/Russians responded
• Russian defence expenditure is modest at best, its got a giant stock pile of Soviet equipment which would literally allow them to use tanks like ammo rounds which is why the Ukrainians needed the military aid Trump was withholding for anti-tank weapons. Russia's weapon supply chain is almost entirely domestic so won't need to import anything to keep its arms industry going, its manpower rather than equipment they need to worry about.
• The Russians aren't stupid Lavrov did the rounds in China and Iran recently to make sure their flanks aren't exposed plus the Chinese aren't short sighted idiots or war profiteers, they didn't shed all that blood in Korea motivated by money or favours, learn your history!
• Russia doesn't need to invade Ukraine, the Russian speaking east Ukraine already occupies a chunk of Ukrainian territory been fighting off and on for years against the government in Kyiv, Russia is amassing its forces inside Russia on the border as a deterrent to any attempt by NATO at intervention in Ukraine, NATO is all big and mighty kicking kids with AKs around and bombing hapless Arab countries not sure they have the stomach to face off against an angry Russian bear when there's a get out jail free card since Ukraine isn't a NATO member.

I am ambivalent about the Ukrainian situation its largely just Biden stirring up another region to shut his Republican critics up and a bunch of wide eyed Ukrainians who want to believe someone's got their backs. If the West really want to help Ukraine rather than stick it to Russia, they would just ship them LPG at the same discounted price the Russians have to sell gas to Ukraine at, for pipeline access, so they can just shut off the Russian pipelines. Why do you think the US keeps trying to kill Nord Stream 2, because when it goes live, Russia won't need to sell cheap gas to Ukraine instead make them pay market rates, in such a situation it won't take too long for Ukraine to decide where their interests really lie!