Bubble bubble toil and trouble:
The manager, who wanted to remain anonymous, said: “The Chinese delegation has said all week that there will be double-digit growth for years to come and the Brits have lapped it up. But the data doesn’t add up. We think we’ve experienced credit bubbles over the past few years, but China is the biggest. And yet the global economy is looking to China as not just a crutch but a springboard out of the recession. It’s crazy.”
Yep, I’ve heard this too. And, think about it – China was accumulating wealth because American was giving it to them for consumer goods. The American dollar devalues, and the Americans can’t afford Chinese plastic toys anymore, so . . . .
Not so sure I’d describe it as a bubble. It’s more of an illusion. It isn’t backed by people with money. They can always starve a few million people to maintain the illusion.
Anyone looking to China to save the world will rightly deserve the ‘abuse’ that they are about to receive.
Unfortunately, those of us that know better will also be caught up in things! I guess we can have a certain amount of ‘I told you so’ smugness in our forthcoming despair.
Sounds like a house of cards to me. The mere size of the country and it’s population means that the repercussions of the bubble bursting will have global effects. It’s one thing for Greece or Ireland to have riots and collapse economically, but is it quite another to have China doing the same. Think of it as a mouse fart verses an elephant’s. You know the latter is going to be heard if you are in the same zoo.
China also has a ticking demographic time bomb….a rapidly aging population with little or no savings and no government safety net in place.
Militarily opinions are divided about China. It’s current prosperity allows the PLA to modernize it’s equipment but the demographics have somewhat reduced the unease that China’s massive # of boots on the ground formerly incited.
China has the same problem as NA and the EU…an aging population. This is the reverse of the developing world with a population largely under 20.
China will not resort the the west’s foolish ploy of making unskilled immigrants a source of revenue to support under-funded retirement funds.
Despite the Chinese government’s iron handed policy regarding dissent…..they cannot hope to float a policy of multiculturalism….and won’t.
So long as the Euro Zone, and others with the same propensity to maintain the status quo regardless of reality will inevitably reap the benefits of their shortsightedness. It seems that with the help of the MSM, it is all but impossible for any politician to tell it how it is, and attempt to make the appropriate economic cuts to ensure some stability going forward. The world needs more Chris Christies’, the world needs more Ralph Kleins.
China might fall because of financial reasons, but I doubt it. China has maybe 10 years before total collapse though, when it falls it will be because of the enviroment. A chinese woman I have known for 15 years was recently back to her home town in China,after moving to Canada in 1993, when she came back she was telling some of us about her trip. Tha thing that shocked her was how bad the air was, almost unbreathable on most days was her quote. The pictures she showed us were scary, you can’t see more than 100ft in some places and less in others. To make the point, she pointed out during last years fire season when smokey air was making the news everyday, a chinese tourist in Banff was on the news saying how clean she thought our air was, got that, when we thought our air was so bad it made the nightly news for days on end, a person from China thought it was great.
“Experts in China dismiss the hedge funds’ arguments as narrow and exaggerated.”
Interesting,that’s the same language U.S. financial “experts” used when Fannie Mae and Freddie Mac were criticized.
I’ve been reading about this for a couple of years now,and those “experts” say that the Chinese meltdown is inevitable, but that it’ll take a couple more years.
With trillions in loans from the Central Bank to local banks,with collateral based on inflated real estate prices, it’s going to come crashing down one day.
I’ll leave it to the “experts” to predict exactly when that day is.
China president announced the dollar is dead.
I don’t believe the Chinese Empire will last as long as it wishes it would. An aging population, unregulated industry, the value of currency. I hear a lot of bravado but no substance.