Chinese Economics Thread

[Quickie]

Feeling the stones...

Also, quarter on quarter in the same year has a faster response, while quarter to corresponding quarter of previous year smooths at the cost of introducing a lag. It also automatically adjusts for seasonal effects.

Exactly, which makes me wonder why they would claim that the "quarter to immediate previous quarter" is preferable and more accurate. Furthermore, imo, having access to accurate economic data is more important than the "perceived difference" in the methodologies that were used in accessing economic growth. In any case, those methodologies are not top secrets and should be widely available to any country.

 

[Hendrik_2000]

It boils down to the choice of using which of the 2 methods:

1. Quarter on quarter in the same year
OR
2. This year's quarter to last year's corresponding quarter.

I would say the second one is usually the more appropriate method in most cases to measure growth, although this is not always the case. In any case, the article contention is not really about this but about the methodology that China uses in measuring economic growth. Question is: Do the western economists have unlimited access to critical economic data from China. If the answer is 'No', then how reliable can their assessment be?

What are you saying? Didn't you read my post?. The head of national bureau openly stated that China follow international standard when they do the statistical computation .So what critical data from China is not open as your post imply.Chinese economy is by now following open market principle don't get confused with political system. It is in their own interest to be open about their economy As they form the basis to formulate economy policy and attract investment !

 

[crobato]

Chinese firms survey shows recovery signs
by Staff Writers
Shanghai (AFP) Feb 4, 2009

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China's manufacturing activity showed signs of recovering in January, data indicated Wednesday, in a rare piece of optimistic news for the world's third-largest economy.

Some economists said the data could signal that China's manufacturers had overcome the worst of the economic crisis, with companies exhausting their old stock and placing new orders.

"Manufacturing in China is still contracting, but the bottom is now in sight," said Sherman Chan, an analyst with Moody's Economy.com.

The government's purchasing managers' index, or PMI, rose to 45.3 percent in January, up from 41.2 percent in December and a record low of 38.8 percent in November, the official Xinhua news agency reported.

A reading above 50 means the manufacturing economy is expanding, while a reading below 50 indicates an overall decline.

"The accelerated rise of manufacturing PMI undoubtedly points to a recovery in China," Merrill Lynch said in a research note.

However, Citigroup economist Ken Peng cautioned that talk of a recovery could be premature.

"Being 'less bad' is not the same as 'recovery'," Peng said.

Indeed, January's figure was the sixth consecutive month that the PMI was below 50 percent.

And a similar survey by CLSA Asia-Pacific Markets, a leading independent brokerage, released on Monday gave less optimistic results.

The CLSA China Purchasing Managers Index, stood at 42.2 in January, up only slightly from 41.2 in December.

The government's PMI is published by the National Bureau of Statistics in cooperation with the China Federation of Logistics and Purchasing.

It is based on surveys of more than 700 manufacturers for their views on 11 key indicators including new orders, employment, supply and inventory.

China's manufacturing sector accounts for more than 40 percent of the nation's economy.

 

[Autumn Child]

Yes it certainly does'nt feel like we've been in a recession for more than a year and such a long time ago when the HKSB first reporting trouble with those sub prime investments.but in the West one does get the benefit of the Peter Schiffs who had forseen increasing problems with the sub primes, and the ever growing American deficit a year before a meltdown happened. In China I think one would be more restrained in giving a different opinion to the official one.
I don't think Germany misreported its figures,and its economy was quite sound with its factories having good orders.its circumstances are due to outside factors.
To put all in a nutshell this recession is due to a financial meltdown, rather than a industrial, technology bubble bursting or a fuel one.

The govt in china does not restrict economic views. My professor in CEIBS openly argues against govt economic policy openly in class. Just in case you don't know CEIBS, it is a govt sponsored/backed business school (no.8 in the world and N0.1 in asia). Every year, there are also economist warning of economic doomsday here and they are still living in their home...not in jail. Please understand that there is no secret police patroling in our neighborhood. Like you said, westerners need to understand china better.

China is known to message its economic data, which mean that the official report is lower than real data if growth is high, but higher than real data if growth is too low. However, they still use real numbers and use flexibility in methadology to message the data. In the end all of the data combined average out to be quite accurate in the medium term.

Most of the change in china's economy during the financial crisis is also due to external shock (falling demand world wide, but increasing demand domestically). The major factories here that constitute the majority of industrial output are also fundamentally sound with healthy amount of orders and cash before the crisis.

 

[bladerunner]

The govt in china does not restrict economic views. My professor in CEIBS openly argues against govt economic policy openly in class. Just in case you don't know CEIBS, it is a govt sponsored/backed business school (no.8 in the world and N0.1 in asia). Every year, there are also economist warning of economic doomsday here and they are still living in their home...not in jail. Please understand that there is no secret police patroling in our neighborhood. Like you said, westerners need to understand china better.


China is known to message its economic data, which mean that the official report is lower than real data if growth is high, but higher than real data if growth is too low. However, they still use real numbers and use flexibility in methadology to message the data. In the end all of the data combined average out to be quite accurate in the medium term.

Most of the change in china's economy during the financial crisis is also due to external shock (falling demand world wide, but increasing demand domestically). The major factories here that constitute the majority of industrial output are also fundamentally sound with healthy amount of orders and cash before the crisis.

OK But I think you misunderstood my use of the word 'RESTRAINED' BY this I mean I didnt think a person in China would have the same type of forums at his disposal to express his views as, the Peter Schiffs, and company.eg high profile late night chat shows etc etc.

 

[Quickie]

What are you saying? Didn't you read my post?. The head of national bureau openly stated that China follow international standard when they do the statistical computation .So what critical data from China is not open as your post imply.Chinese economy is by now following open market principle don't get confused with political system. It is in their own interest to be open about their economy As they form the basis to formulate economy policy and attract investment !

There's probably a misread here. What I meant was the western economists may not have access to a more detailed chinese economic data and, therefore, may not be able to come out with a reliable assessment. As for the openness of China's economic data or information, maybe it's more opened than what most western media would normally report to be so. Maybe some of you guys know better on this matter?

 

[Autumn Child]

OK But I think you misunderstood my use of the word 'RESTRAINED' BY this I mean I didnt think a person in China would have the same type of forums at his disposal to express his views as, the Peter Schiffs, and company.eg high profile late night chat shows etc etc.

Some of their article and editorials are printed in China Daily and other major newspapers. The debate show in phoenix TV is probably more high profile than late night show in the US. So, yes they get high profile coverage as long as what they are saying make sense, is backed by solid data and analysis and not a direct attempt to destabilize govt or is politically motivated.

 

[Hendrik_2000]

Some of their article and editorials are printed in China Daily and other major newspapers. The debate show in phoenix TV is probably more high profile than late night show in the US. So, yes they get high profile coverage as long as what they are saying make sense, is backed by solid data and analysis and not a direct attempt to destabilize govt or is politically motivated.

Right Mr Michael Patis a professor at Beijing University is regular guest at CCTV. And he regularly predict coming doom in China. He even has his own website check it out. Last falll he criticize the slow appreciation of Yuan would result in flood of hot money resulting in high inflation and wreck chinese economy. Check earlier posting in this thread . Of course we know what happened since

 

[pla101prc]

OK But I think you misunderstood my use of the word 'RESTRAINED' BY this I mean I didnt think a person in China would have the same type of forums at his disposal to express his views as, the Peter Schiffs, and company.eg high profile late night chat shows etc etc.

aside from the revered pheonix tv, which is more fair and balanced than CNN and Fox can ever dream of being (or not being), despite the fact that it actually speaks on behalf of Beijing. CCTV has an entire channel dedicated to economics. CCTV 2. i had the privilege of taking a good look at it during the summer. its a GOOD program. they interview economists from all over the world. because its difficult for normal citizens to link economics with politics, the reports are for most part unbiased. i watched its report on the oil price surge in the summer, it provided some good insight that helped me to understand this stuff beyond just the middle east fiasco. so actually i think a lot of Chinese ppl are better informed about the economy than ppl here in the west.

 

[pla101prc]

Right Mr Michael Patis a professor at Beijing University is regular guest at CCTV. And he regularly predict coming doom in China. He even has his own website check it out. Last falll he criticize the slow appreciation of Yuan would result in flood of hot money resulting in high inflation and wreck chinese economy. Check earlier posting in this thread . Of course we know what happened since

i thought Yuan depreciated in the past few weeks? but anyhow one thing si for sure it is that hot money is flowing out of China right now. but apparently hot money does not "win" anything unless the total amount that flows across borders are large enough in quantity...like larger than the country's forex