Chinese Economics Thread
- Thread starter Norfolk
- Start date
Friday was Qingming, a public holiday. So you are seeing 2 down days compressed into 1, hence the bigger fall. Chill, no need to panic.
Also, the fund managers globally have been hit by margin calls from excessive volatility. When you need to raise cash, you sell anything and everything - the most liquid stuff gets sold first to meet the urgent need for cash. hence even gold takes a hit.
You should see how the Chinese stock market fell to shit during the greatest economic expansion in human history! The Shanghai Index dropped 50% between 2000 and 2004 when China entered the WTO and the real economy was growing at almost double digits. It then went and did nearly 50% drops two other times (after massive run-ups.)
It has always been a casino with little connection to the actual economy.
Pardon my ignorance in economics, but why does econ Twitter blame Michael Pettis — and to a lesser extent Brad Setser — for laying the theoretical groundwork behind Trump’s current economic policies (i.e., economic warfare against the ROW?)
DO the same to ships that are built in other countries.
Given that a lot of the ships are made in China, that along with the tariffs could be a huge supply shock, probably something that hasn't been seen in decades.
manqiangrexue
Brigadier
It's actually amazing how we see the wisdom of the CCP decades after its policies.
Long ago, people lamented China's limits preventing Google from dominating China with its world-beating services. When Trump came to office in 2016 and the bans started to target Chinese tech, we saw how smart and important that decision was, otherwise America could fry the nerves of our tech industries.
Now, we had people lament how China's financing is behind and doesn't have a robust stock market where people trust to put all their savings into for long term appreciation and can rely on growing old. Now we see why that's a great idea in a full scale trade war.
You have articles saying how Michael Pettis is being read by the Trump team, because it provides them with intellectual backing for bad ideas.
They're economic cranks talking non-stop about global trade imbalances (conveniently ignoring services) as the literal explanation for 99% of all bad things happening around the world. Tariff the bad people and the problem will go away.
But the thing is that all the biggest carriers already own some Chinese made ships. Even if the ship making the port call is not made in China, they will still impose a fee a long as the carrier has Chinese made ships in its fleet?
manqiangrexue
Brigadier
Yup, that's how desperate and poorly thought-out this plan was.