Chinese Economics Thread

[Bellum_Romanum]

"These are some of the motivations behind the antitrust measures that Beijing announced last year targeting its internet giants. American and Chinese regulators face similar issues, but China seems more serious about taking decisive action than its Western counterparts, and appears to be focusing on the monopoly problem in particular. The opening salvo of the Chinese government’s efforts to curtail tech monopolies came on November 3, 2020, when the Shanghai and Hong Kong Stock Exchange suspended the initial public offering of Ant Financial, which would have been the largest in history at around $240 billion. In subsequent actions, Chinese regulators warned the country’s internet giants that they could not maintain a monopolistic hold on the mass of personal data that drives their businesses and stifles competition from new market entrants, and proposed new regulations to prevent monopoly control of data. These measures have often been portrayed in Western media as old-fashioned Communist Party crackdowns on free enterprise, but they are in fact efforts to avoid the IT sector concentration problems that continue to plague the United States."

A Cautionary Tale

"America’s experience with tech monopolies offers a glaring example of what other countries should not do. The weight of the big tech companies in capital markets is overwhelming. In 2010, the five biggest tech companies accounted for just 11 percent of the market capitalization of the S&P 500; by September 2020, their share of the index had doubled to 22 percent. Just ten companies in the S&P 500 hold two-fifths of all the cash balances of index members, and all but one is a tech giant."

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[MrCrazyBoyRavi]

You definately need quasi monopoly companies if you wanna compete internationally. Chinese companies are already having a hard time expanding outside its border. US is already trying to breakdown or ban chinese tech giants, while China is also making it hard for these companies to grow inside its border. CCP should minimize its heavy handed approach these tech companies.
So should CCP ban TikTok for wasting people’s time making/enjoying short videos?
Should CCP put restriction on Tencent to stop kids from playing video games?
Should CCP stop Alibaba from selling useless goods to peoples ?

 

[siegecrossbow]

You definately need quasi monopoly companies if you wanna compete internationally. Chinese companies are already having a hard time expanding outside its border. US is already trying to breakdown or ban chinese tech giants, while China is also making it hard for these companies to grow inside its border. CCP should minimize its heavy handed approach these tech companies.
So should CCP ban TikTok for wasting people’s time making/enjoying short videos?
Should CCP put restriction on Tencent to stop kids from playing video games?
Should CCP stop Alibaba from selling useless goods to peoples ?

Lean times are near. Many of the crackdown measures are there to provide additional income for the government as well as to score political brownie points with the less well to do.

 

[BoraTas]

You definately need quasi monopoly companies if you wanna compete internationally. Chinese companies are already having a hard time expanding outside its border. US is already trying to breakdown or ban chinese tech giants, while China is also making it hard for these companies to grow inside its border. CCP should minimize its heavy handed approach these tech companies.
So should CCP ban TikTok for wasting people’s time making/enjoying short videos?
Should CCP put restriction on Tencent to stop kids from playing video games?
Should CCP stop Alibaba from selling useless goods to peoples ?

It is an established fact that a Gini coefficient above 0.35, and monopolies are bad for long term growth. I don't see how China is going to lose from its current regulatory measures. China needs to decrease its income equality drastically if it wants to grow faster.

 

[Franklin]

China doesn't have a property tax, a inheritance tax and no capital gains tax ? And China is suppose to be a communist nation. China allows the rich to keep more of their wealth than America.

I support the property tax but not the other two. But I don't like where this is all going. The road to hell is paved with good intentions.

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[Andy1974]

You definately need quasi monopoly companies if you wanna compete internationally. Chinese companies are already having a hard time expanding outside its border. US is already trying to breakdown or ban chinese tech giants, while China is also making it hard for these companies to grow inside its border. CCP should minimize its heavy handed approach these tech companies.
So should CCP ban TikTok for wasting people’s time making/enjoying short videos?
Should CCP put restriction on Tencent to stop kids from playing video games?
Should CCP stop Alibaba from selling useless goods to peoples ?

I think many here are missing the point of these new regulations…

companies that rely on the exploitation of personal data (taken without permission) will not survive in the medium term.

companies that have business models based on value to the economy and society will survive.

China is improving their companies by forcing them to severely compete with each other and have sustainable business models so that when they encounter foreign competition they are very much fitter.

Chinese companies will compete with American ones in international environments where personal data is protected by law. Chinese companies will be prepared, the CCP is making sure of it.

 

[Overbom]

Bloomberg (surprising) had an article theorising that China might be switching from the Anglo-Saxon economic model to Germany's model.

Thats a switch from the megacorp financial and tech (low tech internet companies) system to the industrial and innovative SMEs companies.

You can see that on China being on a regulatory attack against these "high"-tech companies while obviously supporting and directing investment to innovative industries (IC, green industry, aerospace etc)

So basically, China is tired from having all this investment flowing to "useless" industries (for China national strategic objectives) and is now switching to the "beating"

If investors still dont get the message then China will keep hitting these same industries. However from current analysis I have read it seems that Western Bankers have gotten the message and are starting to follow China's directions for investing on the "right" sectors

 

[DarkStar]

Bloomberg (surprising) had an article theorising that China might be switching from the Anglo-Saxon economic model to Germany's model.

Thats a switch from the megacorp financial and tech (low tech internet companies) system to the industrial and innovative SMEs companies.

The anglosphere is very much a feudal system whereas the European model is much more egalitarian

 

[AndrewS]

Bloomberg (surprising) had an article theorising that China might be switching from the Anglo-Saxon economic model to Germany's model.

Thats a switch from the megacorp financial and tech (low tech internet companies) system to the industrial and innovative SMEs companies.

You can see that on China being on a regulatory attack against these "high"-tech companies while obviously supporting and directing investment to innovative industries (IC, green industry, aerospace etc)

So basically, China is tired from having all this investment flowing to "useless" industries (for China national strategic objectives) and is now switching to the "beating"

If investors still dont get the message then China will keep hitting these same industries. However from current analysis I have read it seems that Western Bankers have gotten the message and are starting to follow China's directions for investing on the "right" sectors

More broadly speaking, it's the difference between Financial Capitalism versus Industrial Capitalism

 

[horse]

Bloomberg (surprising) had an article theorising that China might be switching from the Anglo-Saxon economic model to Germany's model.

Thats a switch from the megacorp financial and tech (low tech internet companies) system to the industrial and innovative SMEs companies.

You can see that on China being on a regulatory attack against these "high"-tech companies while obviously supporting and directing investment to innovative industries (IC, green industry, aerospace etc)

So basically, China is tired from having all this investment flowing to "useless" industries (for China national strategic objectives) and is now switching to the "beating"

If investors still dont get the message then China will keep hitting these same industries. However from current analysis I have read it seems that Western Bankers have gotten the message and are starting to follow China's directions for investing on the "right" sectors

Comrade, that is the thoughts of Prof. Micheal Hudson, who is an advisor to the CCP.

There is a difference between the traditional industrial capitalism of the Germans of yesteryear, and the Wall Street banksters capitalism practiced in America today, which is the financialization of everything.

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