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Sign up with Google Sign up with FacebookQ: Will the Chinese economy stagnate?
The CCP is saying growth will be between 6.5 and 7.0% this year. If you read outside news, most of such growth is fueled by debt and credit extension. Chinese corporate debt is by far and away the highest in world, and banks are filled with bad loans. Is the average Chinese citizen aware of the debt level here? No, but the wealthy are, and that's why they're moving their money abroad.
In the end, due to the fact the economy here is controlled by a central force, a hard landing is not possible. However, what I see happening is growth slowing to 2-3% within 5 years or so, and then essentially 0-1% growth for 20+ years, much like Japan has and is experiencing. This is due to bad economic policies being executed presently to keep that precious GDP figure rising.
The problem with such a scenario is that China is not yet rich; Japan got rich, then stagnation occurred, hence no major uprisings. Will such stagnation cause social chaos in China?
7 years 41 weeks ago in Business & Jobs - China
"It is Japan/USA/Taiwan/Tibet/HK's fault! Those damn Foreignerland people are sabotaging the Glorious PRC's economic expansion because they are jealous/afraid/hate the prosperity of PRC. It is a global conspiracy coordinated by the Dali Lama."
Englteachted:
That's exactly what a student told me. But they were serious
"It is Japan/USA/Taiwan/Tibet/HK's fault! Those damn Foreignerland people are sabotaging the Glorious PRC's economic expansion because they are jealous/afraid/hate the prosperity of PRC. It is a global conspiracy coordinated by the Dali Lama."
Englteachted:
That's exactly what a student told me. But they were serious
http://www.macrobusiness.com.au/2012/07/china-will-grow-old-before-it-gets-rich/
this was predicted 4 years ago.
ww.cnbc.com/2013/10/10/china-will-get-old-well-before-it-gets-rich.html
ambivalentmace:
http://www.businessinsider.com/will-china-get-old-before-it-gets-rich-2011-7
correction 5 years ago, 2011
ambivalentmace:
the opposing view for 50 centshttp://zzwave.com/plaboard/posts/3948661.shtml
No. It will grow straight like an arrow aimed at 45 degrees, endlessly, like never happened before in human history.
Exactly.....
All economies go through cycles, we know this. This has been happening every few years back in our respective countries and we expect the cycle. The Chinese have been promised growth, growth and more growth and the Chinese being Chinese believe it. This country has boosted the economy by infrastructure improvements, property market, producing cheap goods for the world and stock market investment. All of these approaches have had their problems because none of them have been thought through properly. I do not think it is a question of will the economy stagnate, of course it will. It is more a question of will it stagnate enough so that the guy in the street begins to notice that the reality does not quite match the rhetoric, that is the big problem for Beijing, because we all know Chinese cannot accept anything is their fault. So the government is going to deflect and hope the smoke and mirrors show is enough to keep the blame away from them. So who will get the blame? America will, the Philippines will, Europe will and every other foreign entity they can think of, including probably you and me walking down the street. The Chinese people have been so sheltered from the realities of how the world really works economically it is going to be a nasty jolt when it hits home.
Stagnate? It's been in repose for nearly 6 years! Look at the exchange rate, it says it all.
QE2 isn't just a monarch, it's the quintessential driving force in Chinese central banking policy because 3 is an unlucky number. Or some other superstitious bullshit. Maybe it's 4.
Who cares?