Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The Chinese Government Likely Borrowed More than the US in 2017

thesoundingline.com

Post reply on HN
Print view View original

131–140 of 159 posts

Re: The Chinese Government Likely Borrowed More than the US in 2017

#131

Post by ggm »

seanmcdirmid wrote: post #98
ggm wrote: post #87

Earlier quoted context omitted.

Cheaply btw. Pumping sand is not hard. And, they're doing it on existing reef structures. The sand only lasts because there is an anchor there. This is not primarily military budget, any more than the US army corps of construction is military budget when it builds dams and Levees in the USA mainland (which btw, it does, a lot) Military budget is materiel. Sand, even runways, is not Materiel.

The only purpose for building those islands out is militarily. If it’s not coming out of the PLAN budget directly, I would be very surprised.

The purpose is to solidify the claim of territory, the enforcement will be military because China won't back down on this, and the law court path has been rejected. Open seas is the current active, western fleet response. If the Chinese miltary get the upper hand in the political conversation they WILL use this to argue for budget, to get more aircraft carriers, and more sea-active weapons. But that is future spend and is not on the current budget horizon is it?

So yes, there is a war war not jaw jaw aspect to building the islands, but the budgetary impact? low. Until they fund bulding the aircraft carriers, and stealth UAVs.

Re: The Chinese Government Likely Borrowed More than the US in 2017

#132

Post by seanmcdirmid »

dv_dt wrote: post #129
seanmcdirmid wrote: post #128

Earlier quoted context omitted.

China’s official GINI coefficient doesn’t include grey income (e.g. that official making 10k RMB/month yet driving a black Audi A9). Well, they stopped reporting it in the early part of this decade when it started getting really bad.

There are always reporting problems, especially tracking the wealth of the extreme rich. Estimates of hidden income and wealth are in the trillions. Gini in both China and the US are likely worse in actuality. But when you're in the middle of the process of converting your economy from rural to modern then it's much easier to swing the Gini change in the more equal direction. But because it's a different situation an…

They stopped reporting their gini coefficient number altogether. There are no numbers after 2012.

I lived in a Chinese first tier city for 10 years. Income inequality was much more obvious there than I ever saw in the states (even in the boonies of Mississippi). A lot of that was related to china’s caste/hukou system that basically denies social services to migrant workers.

Yes, the USA has first world income inequality problems. But China has third world ones.

The joke goes: the USA has so many homeless people, they are just everywhere! China has no homeless people, because the police beat them pretty harshly so they are either dead or really good at hiding.

Re: The Chinese Government Likely Borrowed More than the US in 2017

#133

Post by godzillabrennus »

echochamberhn wrote: post #113
woah wrote: post #72

Earlier quoted context omitted.

If the US decide to spend trillions building skyscrapers its cities, then housing might be affordable

Except that the ghost cities in China are of incredibly poor quality and falling apart a mere months after construction. Other than that, good point!

The USA has a bit more experience building high quality skyscrapers than China.

Re: The Chinese Government Likely Borrowed More than the US in 2017

#134

Post by known »

seanmcdirmid wrote: post #85
known wrote: post #51

US is exporting $500 billion currency to China; And China is investing that money back in https://en.wikipedia.org/wiki/United_States_Treasury_securit... resulting in $1,181 billion debt to USA

If you include HK and Taiwan, they own a whopping $1500 billion in US debt via treasuries. But these are just savings instruments for them, a way to deal with excess foreign reserves without messing with their own exchange rates. It isn’t like the USA is begging them to buy treasuries, more like treasuries are provided as a service that makes the dollar so useful in trade. The yuan does not provide the same service t…

Unlike Yuan, US$ is https://en.wikipedia.org/wiki/Petrocurrency

Re: The Chinese Government Likely Borrowed More than the US in 2017

#135

Post by seanmcdirmid »

known wrote: post #134
seanmcdirmid wrote: post #85

Earlier quoted context omitted.

If you include HK and Taiwan, they own a whopping $1500 billion in US debt via treasuries. But these are just savings instruments for them, a way to deal with excess foreign reserves without messing with their own exchange rates. It isn’t like the USA is begging them to buy treasuries, more like treasuries are provided as a service that makes the dollar so useful in trade. The yuan does not provide the same service t…

Unlike Yuan, US$ is https://en.wikipedia.org/wiki/Petrocurrency

The dollar is the petrocurrency because it is fully convertible and because the US government will always trade it for treasuries (no matter how much), not the other way around. It is extremely safe and liquid, so everyone (even China) uses it for trade.

Re: The Chinese Government Likely Borrowed More than the US in 2017

#136

Post by seanmcdirmid »

ggm wrote: post #131
seanmcdirmid wrote: post #98

Earlier quoted context omitted.

The only purpose for building those islands out is militarily. If it’s not coming out of the PLAN budget directly, I would be very surprised.

The purpose is to solidify the claim of territory, the enforcement will be military because China won't back down on this, and the law court path has been rejected. Open seas is the current active, western fleet response. If the Chinese miltary get the upper hand in the political conversation they WILL use this to argue for budget, to get more aircraft carriers, and more sea-active weapons. But that is future spend a…

But without those investments those islands are hardly definsible, too far from hainan to be easily resupplied during hostilities and no intrinsic production capabilities in their own. Even with further military try investments, they are still probably strategically useless.

Re: The Chinese Government Likely Borrowed More than the US in 2017

#137

Post by moomin »

repolfx wrote: post #30
moomin wrote: post #11

Earlier quoted context omitted.

Broadly, constant borrowing is sustainable, just look at any European economy. As long as your tax base grows faster than your interest payments there’s no unavoidable problem. This? It’s not sustainable. Sooner or later this will result in a correction. This could range from aggressive budgetary measures, an internal crisis all the way to China monetising its overseas investments (which are extremely extensive).

European economies are hardly poster children for constant borrowing. Most of them have been in enforced austerity for years, and have only managed to avoid much tighter spending cuts because the ECB is funding governments through vast amounts of money printing (which boils down to confiscation of savings). Result: huge government spending overruns, ever-falling savings rates.

Erm... Spain and Greece has been in enforced austerity, no other countries I can think of. And neither have had typical, responsible borrowing patterns. (Nor does Italy, but it’s dodged that bullet.)

(Ireland had some problems just after the crunch but a) entirely because they took on a bank they could have let fail and b) they’ve paid that off now.)

Re: The Chinese Government Likely Borrowed More than the US in 2017

#138

Post by tim333 »

echochamberhn wrote: post #113
woah wrote: post #72

Earlier quoted context omitted.

If the US decide to spend trillions building skyscrapers its cities, then housing might be affordable

Except that the ghost cities in China are of incredibly poor quality and falling apart a mere months after construction. Other than that, good point!

The poster child was Ordos:

>Ordos: The biggest ghost town in China (bbc 2012)

> In Inner Mongolia a new city stands largely empty. This city, Ordos, suggests that the great Chinese building boom, which did so much to fuel the country's astonishing economic growth, is over. Is a bubble about to burst?

While now:

>However, in 2017, the ghost city label is getting more than a little difficult to hang on Ordos Kangbashi. According to a recent report, there are now 153,000 people living there, 4,750 businesses are now in operation, and housing prices have risen roughly 50% on average from the end of 2015, when the local real estate market bottomed out. Of the 40,000 apartments that had been built in the new district since 2004, only 500 are still on the market.

The ghost city thing is exaggerated.

Re: The Chinese Government Likely Borrowed More than the US in 2017

#139

Post by AnimalMuppet »

dnomad wrote: post #73
frogpelt wrote: post #54

Earlier quoted context omitted.

Creating currency out of thin air also creates inflation. Inflation must be kept in check or bad things happen. Maybe the current levels are sustainable. But not all increases in deficit are sustainable.

That's now how any of this works. That's certainly not how inflation works. At some point, particularly given the last 40 years of evidence to the contrary, people need to simply accept that monetary expansion does not "cause" inflation [1]. Inflation is not a monetary phenomenon at all. Inflation is a price level [2] phenomenon largely driven by trade imbalances. Inflation is about market power , or what some call p…

If there's more money, and the more money circulates, and the velocity doesn't change, and the real economy doesn't grow (that is, more stuff is not being produced), then what possibility is left but inflation? Or, in your theory, which of the "outs" that I stated is the one that you think is operating in the real world?

From where I sit, the past 40 year have shown that, if you grow the money supply only a little bit faster than the real economy grows, then you only get a little bit of inflation.

Re: The Chinese Government Likely Borrowed More than the US in 2017

#140

Post by lancewiggs »

godzillabrennus wrote: post #133
echochamberhn wrote: post #113

Earlier quoted context omitted.

Except that the ghost cities in China are of incredibly poor quality and falling apart a mere months after construction. Other than that, good point!

The USA has a bit more experience building high quality skyscrapers than China.

How many has each country built in the last 10 years? China's industry has far far more experience building in the modern era.
Post reply on HN