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China's Subprime Crisis Is Here

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Re: China's Subprime Crisis Is Here

#111

Post by seanmcdirmid »

zcbenz wrote: post #45

If you keep saying China has economic crisis, finally you are gonna be right some day.

There should have been a crisis a few years ago but the government has chosen to keep the bubbles from popping. $1 million for a 90 sqm apartment in Beijing that rents form $1500/month is pretty frothy.

But the CPC repealed the law of gravity, so it doesn't apply to the Chinese economy. Maybe it's really different this time. But probably not. The only question now: will they inflate the currency turning all those savers into losers, or reign in credit and bad debts, choking the economy and growth. They won't be able to just hide behind growth now.

Re: China's Subprime Crisis Is Here

#112

Post by [deleted] »

rosser wrote: post #81
dangerpowpow wrote: post #77

Earlier quoted context omitted.

>India, used to being Nepal's big brother and pushing it around, subsequently closed their border with Nepal No we did not close any border. This is false information.

Dude, I was there . 30 seconds' googling yields citations from Time, the BBC, the NY Times, The Guardian, Wikipedia, and others. How about the guy whose hands were cut off when he tried to smuggle fuel across the border that wasn't closed? Or did that also not happen? EDIT: To be fair, I do remember noting a rather curious difference in tone and content in the reporting about the Nepali constitution's passage and the…

[deleted]

Re: China's Subprime Crisis Is Here

#113

Post by hueving »

rahimnathwani wrote: post #54
fasteddie wrote: post #39

Earlier quoted context omitted.

US treasuries are at historically low rates -- if China dumped 'em all it probably wouldn't move the needle that much. And the reason they hold so many is not as some control play against the US -- its because it was the best way to devalue their currency enough to support exports.

"US treasuries are at historically low rates -- if China dumped 'em all it probably wouldn't move the needle that much." Rates (i.e. yield) and price have an inverse relationship. If China were to sell their bonds, this should reduce the price of bonds (i.e. increase their yield). So, regardless of what we think about the likelihood of this happening, or the magnitude of the impact, 'historically low rates' do not pr…

Historically low rates means people are buying up us bonds even at crap returns. If China dumped us bonds and depressed the price, it would only make the value proposition that much better for the current bond investors so they would gobble them up and push the price right back up.

Re: China's Subprime Crisis Is Here

#114

Post by logicchains »

oliwarner wrote: post #82
rosser wrote: post #48

Earlier quoted context omitted.

China can do things at a scale the West in general, and the US in particular can't even fathom. I was in Tibet with some friends in October. At one point, our tour bus was detoured, because the bridge on our scheduled route wasn't big enough for it, so we drove a couple hours out of our way, and just happened to pass a 10MW solar plant. In the middle of Nowhere, Tibet. A thing we wouldn't even have seen if we hadn't…

That's a neighbour so there's an obvious local power advantage. It's not unimpressive though and I completely agree about there being a scale and general surplus of engineering prowess that the rest of us just can't comprehend. What is perhaps more alarming is their development of Africa. I passed through a few African countries last year and China was everywhere . They're in the up-and-coming metropolises like Addis…

It somehow reminds me of a letter written by Francis Galton, one of the founders of statistics and coiner of the word "eugenics", about the potential for the Chinese in Africa. http://galton.org/letters/africa-for-chinese/AfricaForTheChi... Note that by today's standards his views are pretty barbaric, so it's not easy reading.

Re: China's Subprime Crisis Is Here

#115

Post by lmm »

legulere wrote: post #103
jcoffland wrote: post #33

The American media seems to jump at any opportunity to dismiss China as an economic threat. It makes us feel more secure but leads to a public informed only about one side of China's story. Namely the part our ego can handle. China has regularly surpassed the US in number of cars sold since 2009. China also holds more US debt than any other country. Another way to put that is the US government owes China over 1 trill…

Also China had a positive current account balance of 347 billion dollars in 2015, while the US ran on deficit each year since 1989 and had one of 460 billion dollars in 2015. https://www.cia.gov/library/publications/the-world-factbook/...

http://www.factcheck.org/2008/02/the-budget-and-deficit-unde...

Re: China's Subprime Crisis Is Here

#116

Post by forgetsusername »

jcoffland wrote: post #66
foxhedgehog wrote: post #58

Earlier quoted context omitted.

The research that I did on this for my grad school project with the GAO suggested that there was generally enough liquidity in the secondary bond market to absorb even a mass sale from China over the time period required to do so.

That may be true in the current environment, or in that which you measured in your study, but might be totally different in a struggling economy. Say they decide to have a massive sell of at a strategic moment. Combined with other factors it could have a larger effect. The value of one play matters in checkers but in chess it's the combined value of your moves that win the game.

>Say they decide to have a massive sell of at a strategic moment.

You can't sell into a vacuum. Hence, if they are "selling-off" at a strategic time, then there is someone "buying up" at the same strategic time.

Re: China's Subprime Crisis Is Here

#117

Post by saiya-jin »

oliwarner wrote: post #82
rosser wrote: post #48

Earlier quoted context omitted.

China can do things at a scale the West in general, and the US in particular can't even fathom. I was in Tibet with some friends in October. At one point, our tour bus was detoured, because the bridge on our scheduled route wasn't big enough for it, so we drove a couple hours out of our way, and just happened to pass a 10MW solar plant. In the middle of Nowhere, Tibet. A thing we wouldn't even have seen if we hadn't…

That's a neighbour so there's an obvious local power advantage. It's not unimpressive though and I completely agree about there being a scale and general surplus of engineering prowess that the rest of us just can't comprehend. What is perhaps more alarming is their development of Africa. I passed through a few African countries last year and China was everywhere . They're in the up-and-coming metropolises like Addis…

well, and now let's look what their "competitor" (west) have done during those hundreds of years of presence there...

Yes Chinese are not saints but pure capitalists, I see no evil in their actions. On the other hand, white man's actions there were evil on quite a few occasions

Re: China's Subprime Crisis Is Here

#118

Post by forgetsusername »

rosser wrote: post #84
oliwarner wrote: post #82

Earlier quoted context omitted.

That's a neighbour so there's an obvious local power advantage. It's not unimpressive though and I completely agree about there being a scale and general surplus of engineering prowess that the rest of us just can't comprehend. What is perhaps more alarming is their development of Africa. I passed through a few African countries last year and China was everywhere . They're in the up-and-coming metropolises like Addis…

It's staggering, isn't it? > They're investing hundreds of millions in exchange for the infrastructure they use to strip-mine a country. They aren't even investing that much. The equipment is all being bought — from government-owned companies — with government grant money. They're playing a very long game, and they're incredibly good at it.

>They're playing a very long game, and they're incredibly good at it.

People underestimate the ability of a country like China to utilize decades of modern economic thought and their willingness to apply it.

Re: China's Subprime Crisis Is Here

#119

Post by humanrebar »

lmm wrote: post #92
nebula wrote: post #71

Earlier quoted context omitted.

new constitution, which favored closer ties with China over India. Really? They have it ingrained in the constitution? If Geo-political situation changes, and they need to re-balance their ties? They are going to need constitutional amendments?

The US view of the constitution as a sacred document is quite unusual by international standards. For many people in many countries the constitution is just another law.

That view of the US Constitution is eroding quickly, if it's not gone already. People are more interested in magically finding new things in the Constitution than amending it to correct oversights.

Re: China's Subprime Crisis Is Here

#120

Post by forgetsusername »

TheLogothete wrote: post #72
jcoffland wrote: post #33

The American media seems to jump at any opportunity to dismiss China as an economic threat. It makes us feel more secure but leads to a public informed only about one side of China's story. Namely the part our ego can handle. China has regularly surpassed the US in number of cars sold since 2009. China also holds more US debt than any other country. Another way to put that is the US government owes China over 1 trill…

Believing China's GDP growth rate blows all the credibility out of your argument.

Please provide the estimates for its GDP then. Dismissing the work done by others (which provides an actual figure, right or wrong) is lazy.
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