Chinese Economics Thread

[sunnymaxi]

This is a fantastic news ..

China's per capita electricity consumption is now 8MWh/capita.. surpassed developed/high income countries like France , JAPAN, Germany.



USA - 13MWh
Korea - 11MWh
China - 8MWh
Japan - 7.3MWh
France - 7.19MWh
Russia - 6.9MWh
Germany - 6.06MWh

compare only industrialized countries..

Note- although China is the world's factory consume more electricity in industrial sector but still this is significant.

 

[siegecrossbow]

This is a fantastic news ..

China's per capita electricity consumption is now 8MWh/capita.. surpassed developed/high income countries like France , JAPAN, Germany.

View attachment 143028

USA - 13MWh
Korea - 11MWh
China - 8MWh
Japan - 7.3MWh
France - 7.19MWh
Russia - 6.9MWh
Germany - 6.06MWh

compare only industrialized countries..

A lot of it is still consumed for industry use though.

 

[abenomics12345]

Their economy is based on how many physical things people buy, unlike the US, where nominal GDP relies on inflated costs for insurance, healthcare, housing, transportation, utilities, childcare and education— increasing expenses charged by what feels like PE feudal lords.

The dollars China gets from the US, for example, are still useful for buying things globally—otherwise, why would they sell? They’re not giving anything away for free.

The USD is based off of an unsustainable inflated set of costly services...but yet can buy things globally. By your logic the USD is worth a lot less than its current market price and therefore China should sell every USD it has.

Your logic is internally inconsistent.

 

[Serb]

The USD is based off of an unsustainable inflated set of costly services...

Not the USD, US nominal GDP we talked about. Focus.

but yet can buy things globally.

The USD is not backed by screwed US internal economy composition, but external network effect, financial architecture, military...

China should sell every USD it has.

It shouldn't sell it, as long as it needs it to conduct some international transactions with it,

But they should certainly look to negotiate alternative payment options over time.

This can't happen overnight, this Is a gradual process, like we are currently witnessing.

Your logic is internally inconsistent.

It is 100% consistent, but I don't know why you strawmanned my entire post all of a sudden.

 

[Biscuits]

The USD is based off of an unsustainable inflated set of costly services...but yet can buy things globally.

No one has ever denied USD has value?

Stop strawmanning and how about you finally answer why your magic 17T $ Chinese model fails to, well, model most of China's economy activity?

By your logic the USD is worth a lot less than its current market price and therefore China should sell every USD it has.

If China did that, it would be selling at a loss since no one wants such a large amount of USD at all once.

USD have great value, it's like Roman or Qing silver, you can use it to buy anything and US is producing a steady stream of it depending on demand. Not a single person in this thread as far as I see have denied this.

US can produce a valuable resource and at the same time be behind in overall economy size to a country that has much higher productivity and gdp. Being able to mint valuable coins alone has never made a country the undisputed economic leader, it merely gives it a better hand in commodity trade.

 

[abenomics12345]

Not the USD, US nominal GDP we talked about. Focus.

US Nominal GDP is priced in USD - for you to claim US GDP is 'fake' is functionally labelling the USD as overvalued. This is not a strawman at all.

financial architecture, military

By your logic, Goldman Sachs and Lockheed Martin are...absolutely not part of the US economy.

They have no technological edge in any area of the military now. And without that, they are nothing, since their industrial might is meager.

How does the USD have the backing of the US military when you apparently believe the US military has no technical edge? Every country can claim to 'back up' their currency with their military but why do countries only acquiesce to the US?

No one has ever denied USD has value?

Stop strawmanning and how about you finally answer why your magic 17T $ Chinese model fails to, well, model most of China's economy activity?

You asked literally the dumbest question ever - if the USD is correctly valued then 17T $ economy is correct. If the USD is OVERvalued then 17T is obviously understated. If the USD is UNDERvalued then the economy is less than 17T.

What you and @Serb do not seem to understand is that for all your beliefs about the Chinese economy to be true ('uNdErVaLuEd'), then the Chinese economy, quoted in USD terms, will need to rise to reflect all these supposed 'undervaluations' via USD depreciating (in other words, USD losing purchasing power in RMB terms). Otherwise Chinese people will continue to suffer weak purchasing power globally via services (of which China is a HUGE net importer).

 

[Serb]

US Nominal GDP is priced in USD - for you to claim US GDP is 'fake' is functionally labelling the USD as overvalued. This is not a strawman at all.

PRODUCT is priced in USD. That product could also be shit and overvalued due to internal predatory monopoly rent-seeking, supply constraint paired with excessive currency printing, including financial, litigation, etc voided transactions that are not productive but fictional, etc.

We are not yet at the stage of exchange rates. But I agree, they could also contribute to that exaggeration. For example, currently, relatively higher interest rates in the US contribute to this artificial rise in nominal GDP that diverges it from the real-world results even further...

By your logic, Goldman Sachs and Lockheed Martin are...absolutely not part of the US economy.

They are a part of the US economy, the isolated part. You should have said precisely which part of the economy is responsible.

Endless litigation and administrative friction, or retail sales, for example, have no connection to the USD's international dominance.

How does the USD have the backing of the US military when you apparently believe the US military has no technical edge?

What I meant is that what is currently responsible for the USD's continued dominance internationally is mainly the network effect first.

However, initially, what caused the USD to be used to such an extent, enough for it to kickstart the network effect, was probably military dominance of some sort.

How much it plays a role today, I don't know, in the past they could've used the military to prevent de-dollarization in some isolated cases like Lybia for example.

But since the Ukraine War started basically everyone started de-dollarizing, without any repercussions, it became too much for the US military to handle I think.

However, there are many more factors that contributed to that initial USD hegemony, the military was just one of the examples I gave you.

 

[abenomics12345]

Endless litigation and administrative friction, or retail sales, for example, have no connection to the USD's international dominance.

The USD's international dominance is so despite of the problems you cite - feature, not bug.

PRODUCT is priced in USD. That product could also be shit and overvalued due to internal predatory monopoly rent-seeking, supply constraint paired with excessive currency printing, including financial, litigation, etc voided transactions that are not productive but fictional, etc.

Again, feature, not bug, of USD dominance.

They are a part of the US economy, the isolated part. You should have said precisely which part of the economy is responsible.

When I write GS I really mean the entire US financial services industry and when I write LockMart I really mean the entire military/industrial technology stack. The so called 'endless litigation/excessive money printing" are features, not bugs, of the US financial systems' dominance globally.

Until China starts to improve its domestic capital markets the country will forever be relegated to just making things for American consumers (again, see my point about China as an aggregate exporter of products) at a very cheap price. I for the life of me do not understand why you people feel this is preferable or beneficial in any way shape or form.

internal predatory monopoly rent-seeking

Guess why US stock markets go up? And why everyone wants to invest there? Again, feature not bug, of USD dominance.

the network effect first.

Network effect by itself is useless unless the underlying attributes are attractive/preferable in some way. There have been countless number of network effects that have been broken rather quickly as the underlying attributes deteriorated.

 

[MortyandRick]

Until China starts to improve its domestic capital markets the country will forever be relegated to just making things for American consumers (again, see my point about China as an aggregate exporter of products) at a very cheap price. I for the life of me do not understand why you people feel this is preferable or beneficial in any way shape or form.

Genuinely speaking, what should China do?

 

[Biscuits]

US Nominal GDP is priced in USD - for you to claim US GDP is 'fake' is functionally labelling the USD as overvalued. This is not a strawman at all.



By your logic, Goldman Sachs and Lockheed Martin are...absolutely not part of the US economy.



How does the USD have the backing of the US military when you apparently believe the US military has no technical edge? Every country can claim to 'back up' their currency with their military but why do countries only acquiesce to the US?



You asked literally the dumbest question ever - if the USD is correctly valued then 17T $ economy is correct. If the USD is OVERvalued then 17T is obviously understated. If the USD is UNDERvalued then the economy is less than 17T.

What you and @Serb do not seem to understand is that for all your beliefs about the Chinese economy to be true ('uNdErVaLuEd'), then the Chinese economy, quoted in USD terms, will need to rise to reflect all these supposed 'undervaluations' via USD depreciating (in other words, USD losing purchasing power in RMB terms). Otherwise Chinese people will continue to suffer weak purchasing power globally via services (of which China is a HUGE net importer).

Jesus are you incapable of understanding that RMB in China and USD in US are not freely exchangable measures at an airport exchange rate???

China and US are not two entirely open and 100% integrated economies as you seem to erroneously believe, the vast majority of both countries have their economy generated by internal circulation.

Ive never said that China's gdp is undervalued, both it's nominal (in nominal RMB) and comparative (in USD adjusted for large scale exchanges) gdp should be exactly right valued, assuming China's data is correct.

What I said is that gdp isn't a good way to measure economic power because it makes highly stratified economies look larger than their actual economy size. Not just US is a beneficiary of this effect, India is also.