Chinese Economics Thread

[zgx09t]

Go read my post from Jan 2023 - is 5.5% growth faster or slower than actual growth?

So by your definition, me saying: "I think it will do 5.5%" and the actual data shows: "it actually grew 5.2%" - I am spreading FUD?

Can you do math?

If I remember it correctly, the prevalent consensus range among many analysts was 5.2 - 5.5 % during that time. So no biggie.
Obviously China is holding the line and gradually moving pieces in problem areas step by step, trial and errors. They hold the 1y and 5y LPR steady, in view of a white list that came out for troubled real estate sector and to let soak up new bond issues (RMB 1 trillion?). 7.6% y/y increase in Oct retail sales( Chinese are hoarding gold) is still nothing to sneeze at. It will definitely get better, quality wise.

 

[Blitzo]

2021 data is meaning-f***ing less. If you believe that 2021 is relevant as a datapoint for 'confidence/sentiment' then you've been living under a cave for the past 2 years. I do indeed have data that would suggest this:

View attachment 121671

As I cited, from QFIN's results call just last week:

"In Q3, we saw some volatility in asset quality and key leading risk metrics start to fluctuate from historical best levels achieved in previous quarters. Day 1 delinquency was 4.6% in Q3 versus 4.2% in Q2. The uptick in day 1 delinquency mainly reflected borrowers' negative sentiment toward the ongoing micro uncertainties."

If you can't understand my argument, it would help that you understand before coming out with the bravado.

Population level sampling is the only way of conducting an assessment for the kind of claims you're putting.

I agree that 2021 data is not relevant for today necessarily, but it was ultimately still fair to be considered as a representative sample.


Your anecdotes on the other hand, are not.
Saying you are concern trolling is frankly speaking not unreasonable, and your overall argument would be far stronger if you were merely advocating for a repeat, representatively sampled measure rather than portraying your experiences and anecdotes as representative.

 

[zgx09t]

I doubt he'd do a diff-in-diff for his 200 people and the rest of the 1.4 billions.

 

[Hitomi]

This seems like a significant policy decision. Does anyone have any better information on this than Bloomberg? China moving towards a Singapore social housing system is a interesting way to control real estate growth and housing prices.

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Hope they learn from the mistakes the Singapore government made. There was a period of time when more rampant speculation (within the context of Singapore) was still allowed with the resold units until the government strongly clamped down on it but the rot is slowly creeping back within the market (Singaporeans still see housing as a for profit investment). This is especially if Xi still wants to maintain the "houses are for living, not for speculation" stance.

Not to mention the Singapore housing system is essentially a glorified country wide rental business with the government as the rentier which I have reservations about as you essentially do not own your home fully.

i hope the balloting for housing thing also would not be so hard in China's system as there are many pre-requisites in Singapore.

 

[KYli]

Majority of mainland Chinese owned their own properties which is very different from Singapore. Rental price in China is cheap compare with the price of apartment. Oversupplies of housing are much more serious in China than Singapore especially for 2, 3, 4, 5 tier cities. It would take a long time to absorb such inventory especially as population would flow to top and first tier cities first and foremost.

Beijing, Shanghai, Shenzhen, Guangdong and Hong Kong are different cases. As more people moving to these cities, housing demands would go up and supplies might tighten up as developers stopped or slowdown purchasing lands and building apartment even in top tier cities. That's why it is important for top tier cities to focus on expanding its lands reserves, public housing and major development projects.

I think the biggest problem for both Singapore and Hong Kong is the reluctant of their government to end speculation in housing as land sales have become the most important source of income for Singapore and Hong Kong. As Singapore and Hong Kong refused to increase taxes for corporate, personal income taxes and sales tax to attract talents, land sales has become their treasure box. However, such arrangement of low tax and high home price only benefit the rich and wealthy and detrimental to the poor and youngsters.

 

[abenomics12345]

Population level sampling is the only way of conducting an assessment for the kind of claims you're putting.

I agree that 2021 data is not relevant for today necessarily, but it was ultimately still fair to be considered as a representative sample.


Your anecdotes on the other hand, are not.
Saying you are concern trolling is frankly speaking not unreasonable, and your overall argument would be far stronger if you were merely advocating for a repeat, representatively sampled measure rather than portraying your experiences and anecdotes as representative.

I in fact did ask for countering evidence which he has not provided.
As well, one can be satisfied about the government’s performance *and* have terrible expectations for the economy going forward. Unless you believe this to be untrue in which case you will need to show evidence. I am specifically referring to the economic situation.

Btw there are tons of time series data released by brokers (UBS/Morgan Stanley) which all point to the same issue. Happy to provide if you are interested in learning but it seems he is more interested in labeling me.

I am specifically referring to economic expectations in my long post as it is indeed Chinese Economics thread - I am not here to talk about Chinese governance.

He also doesn’t seem to be interested in responding to my question of whether 5.2 actual GDP growth vs what I said initially at 5.5 was indeed FUD. But sure, I am the one concern trolling.

 

[Feima]

Not to mention the Singapore housing system is essentially a glorified country wide rental business with the government as the rentier which I have reservations about as you essentially do not own your home fully.

This is a nonsense trope pushed by entitled people.

Singapore public housing (and most private housing) homes are sold on lease-hold basis. Majority of leaseholds are for 99 years. Some people claim they don't fully own what they buy, that they are only "renting" from the state, because of the leasehold.

These people usually neglect to point out that they could sell their public housing apartment and get to keep all the profit. If they were really just renting, they certainly wouldn't be allowed to sell their landlord's property.

As for owning something for 99 years means you don't really own it, let's look at it from the opposite perspective: So you paid say 500k Singapore dollars for your public housing apartment. How long do you expect to keep it? 5 generations? Or for the next 3000 years? Pay for something once and expect external usufruct?

Finally, remember the Chinese saying - 没有国，哪有家. Ask the people in Palestine who hold freehold property deeds who have had their properties confiscated by the colonialist settlers and worse. Heck, ask the Japanese Americans who got interned in WW2.

 

[Blitzo]

I in fact did ask for countering evidence which he has not provided.
As well, one can be satisfied about the government’s performance *and* have terrible expectations for the economy going forward. Unless you believe this to be untrue in which case you will need to show evidence. I am specifically referring to the economic situation.

Btw there are tons of time series data released by brokers (UBS/Morgan Stanley) which all point to the same issue. Happy to provide if you are interested in learning but it seems he is more interested in labeling me.

I am specifically referring to economic expectations in my long post as it is indeed Chinese Economics thread - I am not here to talk about Chinese governance.

He also doesn’t seem to be interested in responding to my question of whether 5.2 actual GDP growth vs what I said initially at 5.5 was indeed FUD. But sure, I am the one concern trolling.

I'm not sure what particular threads of discussion past or current you and others are quibbling over regards to GDP growth or specific claims about what constitutes XYZ or ABC.
I don't particularly care and it's not something I've been involved in.

In this case, I'm specifically saying that if you are portraying the people you've spoken to as a representative sample that is reflective of population level feelings towards the economy or general sentiments to the future, then that is no more valid than using a 2021 representative sampling survey for late 2023. This isn't a matter of requiring countering evidence but rather whether your anecdotes should be interpreted by anyone here as representative to begin with.
I assume given you're not choosing to reference this, that you are conceding this point, and if that is the case then I don't have any particular strong opinions about what you or others are writing.

 

[Feima]

Majority of mainland Chinese owned their own properties which is very different from Singapore. Rental price in China is cheap compare with the price of apartment. Oversupplies of housing are much more serious in China than Singapore especially for 2, 3, 4, 5 tier cities. It would take a long time to absorb such inventory especially as population would flow to top and first tier cities first and foremost.

Beijing, Shanghai, Shenzhen, Guangdong and Hong Kong are different cases. As more people moving to these cities, housing demands would go up and supplies might tighten up as developers stopped or slowdown purchasing lands and building apartment even in top tier cities. That's why it is important for top tier cities to focus on expanding its lands reserves, public housing and major development projects.

I think the biggest problem for both Singapore and Hong Kong is the reluctant of their government to end speculation in housing as land sales have become the most important source of income for Singapore and Hong Kong. As Singapore and Hong Kong refused to increase taxes for corporate, personal income taxes and sales tax to attract talents, land sales has become their treasure box. However, such arrangement of low tax and high home price only benefit the rich and wealthy and detrimental to the poor and youngsters.

Singapore's situation is not at all like Hong Kong's.

80% of Singaporeans live in public housing. Of these, 90% own their homes. Of the remaining 20% living in private housing, very few are renting. To cool the residential property market, the Singapore government has imposed additional buyer tax ranging from 20% to 65% of the transaction price. According to data available, the people pushing up home property prices are mostly Singaporeans. Basically, there are a lot of rich Singaporeans and they are buying up homes.

As for Hong Kong, Tung Chee Hwa's attempt to improve public housing failed due to resistance from vested interests. Let's see what the current government can do.

 

[KYli]

Singapore's situation is not at all like Hong Kong's.

80% of Singaporeans live in public housing. Of these, 90% own their homes. Of the remaining 20% living in private housing, very few are renting. To cool the residential property market, the Singapore government has imposed additional buyer tax ranging from 20% to 65% of the transaction price. According to data available, the people pushing up home property prices are mostly Singaporeans. Basically, there are a lot of rich Singaporeans and they are buying up homes.

As for Hong Kong, Tung Chee Hwa's attempt to improve public housing failed due to resistance from vested interests. Let's see what the current government can do.

The difference between Singapore and Hong Kong is Singaporean government did a better job in providing public housing than Hong Kong government. However, just like Singapore, 48% of Hong Kongers live in public housing of which breakdown to 31% PRH(Public rental) and 17% HOS(home ownership scheme). Those live in PRH only paid 2000 to 3000 HKD per month for the rent and most of the tenants would be allowed to live there forever and with one time option to buy either their rental units or HOS units.

Just like Singapore, Hong Kong imposed seller and buyer tax up to 30%. For seller, those who sold home which held less than 3 years would need to pay 10% stamp tax on the value of the property(Cut to 2 years a few weeks ago). For a foreign buyer of HK properties, they would have to pay 30% of their purchase price as taxes, cut down to 15% recently. Local buyers will pay 15% for buying their second homes, cut to 7.5% recently.