We had seen signals since 2008 that the chinese economy is over-leveraged. However its the first time that we are seeing concrete signals that there is a debt crisis in china. I think that nobody can deny it at this point. The question is, how severe is that debt crisis, and how will the government deal with it, taking into account that the country´s growth machines are falling (exports are weakening and there is over-investment resulting in overcapacity).
Chinese Economics Thread
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We had seen signals since 2008 that the chinese economy is over-leveraged. However its the first time that we are seeing concrete signals that there is a debt crisis in china. I think that nobody can deny it at this point. The question is, how severe is that debt crisis, and how will the government deal with it, taking into account that the country´s growth machines are falling (exports are weakening and there is over-investment resulting in overcapacity).
Chinese debt is insignificant compared with American debt. The true American debt is $211 TRILLION. That's 1400% of GDP.
Unlike the US, China is a rapidly developing economy and Chinese debt is used for productive purposes unlike US debt where it's used to keep the American Ponzi scheme economy propped up.
China uses debt to build infrastructure and build factories, the US and others use debt to consume depreciating consumer goods.
When you look at the American, Indian and Japanese economies, it's build on quick sand, they have to go into debt to merely survive. Just look at the way all 3 of those economies are starting to fall apart. America has 0% interest rates, QE infinity, $1 trillion deficits and they still can't grow. That's what you call an economy that is DEAD. It's over stimulated and the economy had died. This happened to the Japanese economy where it's been dead for 20 years now. Indian economy is facing the same future.
Please explain to me how the idiots that couldn't forcast the implosion of the U.S. housing bubble in 2008 are now predicting that China will have an epic economic implosion.
Seriously, Americans are dying and wishing that China's rise would just suddenly disappear so it doesn't have to have a competitor to American hegemony.
Reminds of Gordon Chang, damn that guy is an idiot.
Seriously, Americans are dying and wishing that China's rise would just suddenly disappear so it doesn't have to have a competitor to American hegemony.
Reminds of Gordon Chang, damn that guy is an idiot.
AssassinsMace
Lieutenant General
That's because they're gauging China's economy based on exports to them believing China is totally dependent on them. There are a lot of stories about how outsourcing foreign companies are leaving China saying China isn't cheap anymore. All that means is China is moving up the ladder because people are finding better jobs that pay more. That being said China is in for a correction but not the unrecoverable disaster the pessimists are predicting. According to their own estimates the average Chinese family can't even afford a car yet China is the largest car market in the world with prices on par with the US.
We've been hearing how the chinese economy has been in dire straits since 2008, with experts and media reading all sorts of tea leaves as groundwork for those claims. I can't help but laugh sometimes when I glance at the bbc world homepage and see "weak china manufacturing growth signals slowing economy, prompting concerns" and then a month later "stronger than expected consumer growth stokes hopes of a soft landing"... This dillydallying's been going for years now.
Not to mention gordon chang and the doom prophets even before 2008...
Besides, haven't critics of the chinese economy said the current reforms are necessary, and warned there will be short term pain for long term sustainability? Now that Xi's administration is implementing these reforms, shouldn't we be rejoicing? lol...
Not to mention gordon chang and the doom prophets even before 2008...
Besides, haven't critics of the chinese economy said the current reforms are necessary, and warned there will be short term pain for long term sustainability? Now that Xi's administration is implementing these reforms, shouldn't we be rejoicing? lol...
kwaigonegin
Colonel
Not even close to the truth what you said is all I have to say. Don't get me wrong I think China's rise has been amazing and their economy will continue to grow stronger however the US is not going to go away anytime soon.
The US and Japan's economy while not growing as fast as emerging markets like the BRIC countries is not going to suddenly vanish into thin air either. Common now!
US, China break new ground on climate
By Carey L Biron
WASHINGTON - The United States and China have agreed on a suite of potentially far-reaching initiatives aimed at cutting greenhouse gas emissions in the world's two largest economies and largest polluters.
Environmental groups are applauding initial reports of the agreements, arrived at during high-level talks in Washington on Wednesday and Thursday. Further, there is also a sense that the discussions indicated a warming of relations between the two powers that could constitute the basis for an important new cooperative relationship at international negotiations on climate change.
"I thought it was one of the best sessions for climate change I've
ever sat in," a senior official in President Barack Obama's administration, speaking on background, told reporters Thursday. "Not only were they high-level officials on both sides, but I thought that there was candid discussion, interesting discussion, and most importantly, proposals for cooperation moving forward."
As unveiled on Wednesday and further refined Thursday, the two countries have agreed to jointly focus on five broad areas. These include cutting down on emissions from heavy transport, strengthening energy efficiency, and improving the collection of greenhouse gas-related data.
Washington and Beijing will also step up research into new "carbon capture" technologies at coal-fired power plants, and collaborate on building new "smart" electrical grids that are both more efficient and can more easily incorporate renewable energy sources and distributed generation.
The talks also advanced modalities behind a landmark agreement struck between Obama and Chinese President Xi Jinping in June to reduce the amount of hydrofluorocarbons (HFCs), "super-greenhouse gases" used in refrigeration and air conditioning, the two countries use and produce.
"They're clearly addressing some of the largest sectors in terms of greenhouse gas emissions - buildings, transportation and power, which together constitute the majority of emissions for both countries," Alden Meyer, director of the Washington office of the Union of Concerned Scientists (UCS), a watchdog group, told IPS.
"For the moment, however, it's hard to gauge the actual impact on emissions without knowing more of the details. The most fundamental question is whether these initiatives will merely help the two countries meet already-stated emissions-reductions goals between now and 2020. That would still be good, of course, but it wouldn't be adding additional ambition to the global effort."
Current US policy revolves around a 17% reduction of greenhouse gas emissions below 2005 levels by 2020. For China, the central goal is to cut its economy's "carbon intensity" by 40% to 45%, also by the end of the decade.
Yet Meyer notes that "everyone agrees" that both countries need to do far more if there is to be any chance of keeping the global temperature rise below two degrees Celsius by the end of the century, the current international goal that climate scientists warn constitutes a dangerous cut-off point.
The talks are also being seen as a key success on the part of the new US Secretary of State John Kerry, long known for his climate advocacy. Kerry was integral in setting up a new US-China working group on climate, and reports suggest he has been engaging in this way in nearly every country he visits.
"This is no longer a side issue - Kerry has made climate into a centerpiece of political discussions, elevating it to the top tier of the geopolitical agenda, up there with security and economic issues," Meyer said. "That's also being helped by the recent push by the World Bank, the International Monetary Fund and the International Energy Agency to warn that this is a major threat to development and the world economy alike."
Patching the disconnect
Climate change was not the only issue under discussion during the two-day US-China summit, known as the Strategic and Economic Dialogue (SED). But the talks did showcase the initial results of the bilateral working group on climate, set up in April, the final report of which can be found here.
"One of the great features this year is the special sessions on climate change and energy security, so we envision smaller sessions with a very focused agenda," an Obama administration official told reporters in a briefing on Monday.
"We want to demonstrate to the world that the two largest economies in the world can cooperate in this century to help tackle these environmental challenges ... We're hoping that at the end, we can cite some concrete examples of our cooperation through reduced emissions."
Nor are the five initiatives outlined this week planned to be the end of the new US-China cooperation. The working group on climate is reportedly working unusually intensively, a schedule that is expected to continue.
By October, the group is expected to agree on the implementation details for the first five initiatives. Thereafter, the Obama administration has suggested that climate issues will remain on the annual SED agenda, which will include a yearly review of implementation of previous initiatives and the assumption that new ones will be launched.
The results from this week's discussions could now be used as a springboard to jolt international negotiations in the lead-up to a Paris summit, in 2015, where world leaders will be required to fashion a new global deal on climate change.
"There is renewed momentum between the US and China on climate change. Bilateral efforts between these two countries are essential - and this collaboration can inject additional vigor in tackling climate change around the world," Jennifer Morgan, director of the Climate and Energy Program at the World Resources Institute, a Washington think tank, said in a statement.
"These actions can help build trust and enhance cooperation between these two major countries. The benefits of joint action are clear. Now, we need them to follow up with actions that will drive down global emissions and take advantage of economic opportunities in a low-carbon future."
UCS's Meyer notes that the disconnect between the United States and China on the way forward on climate action has been a key obstacle in the international talks over the past several years.
"To the extent that they're now cooperating on the ground, hopefully that will spill over into a more useful partnership in the negotiations for a post-2020 deal," he said.
"In Paris in 2015 we'll need broad engagement and cooperation among leaders of major countries, which is what we didn't have going into the Copenhagen summit [in 2009]. To have this new relationship at the leadership level more than two years out from the Paris talks is a good thing - this level of engagement among leaders will be essential."
(Inter Press Service)
The Reverse of the Fortune-China developed all of this just in last 15 years while the US destroyed Iraq and Incresed National debts from $6 trillion to more than $16 trillion
[video=youtube;GJXW5gtR7Iw]http://www.youtube.com/watch?v=GJXW5gtR7Iw[/video]
China Needs to fight Smog
[video=youtube;GJXW5gtR7Iw]http://www.youtube.com/watch?v=GJXW5gtR7Iw[/video]
China Needs to fight Smog