China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says • Hacker News Board

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#61

Post by wu-ikkyu » Thu, May 25, 2017, 2:02 AM UTC

matheweis wrote: post #43

Ok, this is probably a silly question, but who holds all the debt now? The avg US citizen would say China holds much of the US debt, but now it sounds like China is borrowing their way into trouble too... it's not any of these third world countries... who is it?

>The avg US citizen would say China holds much of the US debt, but now it sounds like China is borrowing their way into trouble too... it's not any of these third world countries... who is it?

The central banks, obviously. Many of them not being beholden to a nation but to private individuals.

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#62

Post by [deleted] » Thu, May 25, 2017, 2:04 AM UTC

WillPostForFood wrote: post #35

theprop wrote: post #23

Earlier quoted context omitted.

Are you seriously suggesting that US government deficits are run to invest in education and infrastructure? Deficits are mostly attributable to military spending. I'm doubtful that killing people in other countries who present absolutely no threat to you is productivity-enhancing.

I know there is some fake news floating around with a chart that purports to show 57% of spending goes to the military, but it's been debunked. 28% goes to healthcare (Medicare), 25% to Social Security, 16% to Defense. http://www.politifact.com/truth-o-meter/statements/2015/aug/...

[deleted]

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#63

Post by dis-sys » Thu, May 25, 2017, 2:04 AM UTC

Moody's? Is that the same credit rating agency which intentionally inflated credit rating for risky mortgage investment and eventually fined almost $1b[1]? It is just so funny that an agency that has already destroyed its own creditability is still running around and doing credit rating for others.

[1] http://www.abc.net.au/news/2017-01-14/moodys-agrees-settleme...

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#64

Post by theprop » Thu, May 25, 2017, 2:05 AM UTC

dragonwriter wrote: post #29

theprop wrote: post #23

Earlier quoted context omitted.

Are you seriously suggesting that US government deficits are run to invest in education and infrastructure? Deficits are mostly attributable to military spending. I'm doubtful that killing people in other countries who present absolutely no threat to you is productivity-enhancing.

> Deficits are mostly attributable to military spending. Post-WWII federal deficits are mostly attributable to declining total effective income tax rates.

To some extent. Military spending as a % of GDP isn't that high, ~4%...but may still be a bit higher than usual for relative peacetime.

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#65

Post by vectorpush » Thu, May 25, 2017, 2:06 AM UTC

WillPostForFood wrote: post #35

theprop wrote: post #23

Earlier quoted context omitted.

Are you seriously suggesting that US government deficits are run to invest in education and infrastructure? Deficits are mostly attributable to military spending. I'm doubtful that killing people in other countries who present absolutely no threat to you is productivity-enhancing.

I know there is some fake news floating around with a chart that purports to show 57% of spending goes to the military, but it's been debunked. 28% goes to healthcare (Medicare), 25% to Social Security, 16% to Defense. http://www.politifact.com/truth-o-meter/statements/2015/aug/...

I think you're correct to point out the inaccuracies of the image, however I disagree with the cavalier use of the term "fake news" to describe arbitrary instances of false or misleading information. The problem of "fake news" is actively perpetuated in part by the impulse to use the term as a catch-all pejorative for information we deem to be specious.

Fake news is when a media source that claims to report an accurate account of events deliberately peddles stories they know (or can safely assume) are false. Random images floating around the internet are not fake news.

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#66

Post by theprop » Thu, May 25, 2017, 2:06 AM UTC

pmorici wrote: post #30

theprop wrote: post #23

Earlier quoted context omitted.

Are you seriously suggesting that US government deficits are run to invest in education and infrastructure? Deficits are mostly attributable to military spending. I'm doubtful that killing people in other countries who present absolutely no threat to you is productivity-enhancing.

GI bill pays for a lot of education

That was after WWII...it still does a bit because there aren't enough "volunteers" to work in the US army...

Remember that the volunteer army was formed after Vietnam and all the objections to the draft (mostly by better-off, educated Americans...)...

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#67

Post by theprop » Thu, May 25, 2017, 2:09 AM UTC

WillPostForFood wrote: post #35

theprop wrote: post #23

Earlier quoted context omitted.

Are you seriously suggesting that US government deficits are run to invest in education and infrastructure? Deficits are mostly attributable to military spending. I'm doubtful that killing people in other countries who present absolutely no threat to you is productivity-enhancing.

I know there is some fake news floating around with a chart that purports to show 57% of spending goes to the military, but it's been debunked. 28% goes to healthcare (Medicare), 25% to Social Security, 16% to Defense. http://www.politifact.com/truth-o-meter/statements/2015/aug/...

It's hardly fake news. It's actually the truth. Of discretionary federal government spending, ~57% does go to the military (if you don't include interest expense on the deficit I believe...removing that...)

https://www.nationalpriorities.org/budget-basics/federal-bud...

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#68

Post by vijucat » Thu, May 25, 2017, 2:12 AM UTC

The day after the Fukushima nuclear incident, the top-voted article on HN was an extremely confident-sounding article by an expert about how this was a minor incident, sure to be contained and forgotten. The comments in the article were dismissive about alarm. I remember feeling a sigh of relief that the experts had pronounced it a minor incident. As the days rolled by, the news about Fukushima turned from bad to worse to horrible. Unfortunately, my archive.org skills were not good enough to dig up the front page of HN around that time to show you the article in question.

A closer tale about experts being wrong, and persistently so is the tale of the Japan Bonds' "widowmaker" trade: apparently, a lot of smart people have been wrong about this:

http://www.businessinsider.com/hedge-funds-feeling-confident...

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#69

Post by zeusk » Thu, May 25, 2017, 2:16 AM UTC

hackuser wrote: post #53

drcode wrote: post #31

Earlier quoted context omitted.

It seems like smart people have been predicting that China's growth is unsustainable on a regular basis for at least 15 years... it's tough for an average HNer like myself to take the time to tell which "expert" is just blowing smoke and which expert truly has a handle on the salient facts- Guess all I can really do is simply wait and see who ends up being right...

Agreed, to an extent (though not every 'expert' is equally reliable). Two ways I look at it: 1) Generally, the nature of a bubble is that nobody knows when it will pop. People knew about the U.S. asset bubble in the mid-2000s for years, but even those not caught up in the bubble mass psychology couldn't accurately predict when it would collapse. The same was true of the dot-com bubble around 2000. You can be right th…

> There was a stock broker looking for new business. He cold called 512 people (he must have been a quant); half he told to sell X stock, half he told to buy. The next week he called the 256 for whom he'd made the right prediction and did the same again: Half he told to sell, half to buy ... several weeks later he was down to 16 people. He called all of them and said, 'look, I was right 5 times in a row ...'.

Except, what you just described is a scam and not something a registered broker can do.

Re: China Can’t Sustain Its Debt-Fueled Binge, Moody’s Says

#70

Post by zeamaize » Thu, May 25, 2017, 2:18 AM UTC

vijucat wrote: post #68

The day after the Fukushima nuclear incident, the top-voted article on HN was an extremely confident-sounding article by an expert about how this was a minor incident, sure to be contained and forgotten. The comments in the article were dismissive about alarm. I remember feeling a sigh of relief that the experts had pronounced it a minor incident. As the days rolled by, the news about Fukushima turned from bad to wor…

But Fukushima was a minor incident...