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The Chinese Government Likely Borrowed More than the US in 2017

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

#141

Post by TallDave2 »

tim333 wrote: post #138
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 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…

Ordos is actually still pretty ghosty. 153K people seems great until you realize it was built for several times that many. http://www.businessinsider.com/ordos-china-ghost-town-2017-5

In the US, everyone associated with the investment would have lost their shirts years ago. In Communist China, debt pays you!

The really interesting thing is that the units are mostly owned. Why? Because you can't move very much money out of China due to the capital controls, tremendous flows of money go into property -- lots of people buy real estate never intending to live in it, or sometimes even to rent it... there are actually property sales ads that suggest no one should live there as the property is not designed for human habitation. :)

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

#142

Post by TallDave2 »

ihsw2 wrote: post #53
chvid wrote: post #18

China is still a developing nation. That means that China can invest in infrastructure (roads, trains, airports, education) which have high real return making the increase in debt much less of a problem. This is also the reason why China has grown persistently 7-10% over the past two decades compared to USA which have grown 2-3% in the same period. Per person China's GDP is less than a fifth of the US hinting that th…

Using per person GDP when discussing China is a cruel joke. Like most usages of per person GDP in any country, it glosses over regional disparities and (more importantly) economic equality measures like Gini coefficient. Taking Gini coefficient into consideration, China still has a long way to go.

Gini implicitly assumes a flat distribution is desirable. Ask North Korea and Cuba how that works out.

PPP GDP per capita is okay, but the PPP portion is rife with assumptions, some untenable. For instance, you really really don't want to live in a heavy industrial area in China, the air is like soup -- sometimes it pegs the AQI needle at 999. US hasn't ever had air that bad, even before the Clean Air Act.

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

#143

Post by TallDave2 »

Theodores wrote: post #90
chvid wrote: post #18

China is still a developing nation. That means that China can invest in infrastructure (roads, trains, airports, education) which have high real return making the increase in debt much less of a problem. This is also the reason why China has grown persistently 7-10% over the past two decades compared to USA which have grown 2-3% in the same period. Per person China's GDP is less than a fifth of the US hinting that th…

China spend money on infrastructure, meanwhile in the West there is 'Quantitative Easing' with money going straight to the banks. As you state there is real return in infrastructure expenditure - roads, trains, airports, education is genuine investment. A business case can be made for putting in a new 300kmh train set that spans the country. Over in the West we don't get that, instead we have to pay untold billions t…

Unfortunately a lot of times those "investments" probably actually provide less value than they cost to maintain, let alone to build and maintain, particularly HSR which is generally only high ROI in a few small, rich countries with large point-to-point traffic over distances short enough that air doesn't make more sense (e.g. Japan). It's very easy to destroy value in building something.

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

#144

Post by TallDave2 »

gnarcoregrizz wrote: post #112
Theodores wrote: post #90

Earlier quoted context omitted.

China spend money on infrastructure, meanwhile in the West there is 'Quantitative Easing' with money going straight to the banks. As you state there is real return in infrastructure expenditure - roads, trains, airports, education is genuine investment. A business case can be made for putting in a new 300kmh train set that spans the country. Over in the West we don't get that, instead we have to pay untold billions t…

I've heard their directed investments referred to as 'qualitative easing' https://blogs.wsj.com/chinarealtime/2014/08/11/how-chinas-tr... . Unfortunately in the US, like you said, it seems like a lot of the capital has gone into west coast real estate and the stock market. Why wouldn't it? It's a lot easier to make money from rents than to actually build things. I'm always awed by how much indirect ROI you can get fr…

As with most projects from that era, the environmental impact study/mitigation for such an effort today would probably cost more than the entire original project, even in real dollars, even assuming you would be allowed to build it (you probably wouldn't).

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

#145

Post by gnarcoregrizz »

TallDave2 wrote: post #144
gnarcoregrizz wrote: post #112

Earlier quoted context omitted.

I've heard their directed investments referred to as 'qualitative easing' https://blogs.wsj.com/chinarealtime/2014/08/11/how-chinas-tr... . Unfortunately in the US, like you said, it seems like a lot of the capital has gone into west coast real estate and the stock market. Why wouldn't it? It's a lot easier to make money from rents than to actually build things. I'm always awed by how much indirect ROI you can get fr…

As with most projects from that era, the environmental impact study/mitigation for such an effort today would probably cost more than the entire original project, even in real dollars, even assuming you would be allowed to build it (you probably wouldn't).

Yeah. The Hoover dam would never happen nowadays, and it has undoubtedly had some environmental effects.

Here is a fun example of how expensive infrastructure is here now:

Irvine to Corona tunnel (11.5 mile tunnel under mountains) which would connect Orange County to Riverside County: estimated 28.3 billion [1]. Both are large population centers with large economies, separated by a small-ish mountain range. They spent almost 30 million on environmental studies.

Norway made a 15 mile tunnel through the mountains for 113 million, or 0.4% of the cost. [2]

1. https://www.ocregister.com/2010/08/27/plans-for-irvine-coron...

2. https://en.wikipedia.org/wiki/L%C3%A6rdal_Tunnel

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

#146

Post by EGreg »

dpark wrote: post #77
EGreg wrote: post #64

Earlier quoted context omitted.

Did China agree it is theft? The US doesn’t respect trademarks like Kobe Beef, Parmesan Cheese etc. http://www.internationaltrade.law/blog/why-youve-probably-ne...

> I can pretty much confirm that I have never had real Parmesan Cheese, and neither have you. That is a bizarre claim. If you’ve only ever bought pre-grated Kraft “Parmesan”, that might be true. But it’s not difficult to buy Parmigiano-Reggiano in nicer grocery stores. Also the EU has hundreds of special designations. It’s not surprising that the US would decline to give a blanket deference to EU law in this area.

While it may not be difficult, what I said is correct.

Why should China respect IP of USA if USA doesn’t respect IP of Europe?

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

#147

Post by microdrum »

vkou wrote: post #121
microdrum wrote: post #83

Earlier quoted context omitted.

"monetary sovereign" It still requires them to get many other rich countries to generally buy into their story.

As long as you keep buying cheap (And a few expensive) things made in China, you're buying into the story. Where do you think your iPhone is built?

Not rich countries' consumers; rich countries' governments, economists, and academics.

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

#148

Post by vkou »

microdrum wrote: post #147
vkou wrote: post #121

Earlier quoted context omitted.

As long as you keep buying cheap (And a few expensive) things made in China, you're buying into the story. Where do you think your iPhone is built?

Not rich countries' consumers; rich countries' governments, economists, and academics.

What does their belief or disbelief have to do with whether or not China is a monetary sovereign?

I mean, I suppose they can all imagine that spherical cows exist, but wishing won't make it so.

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

#149

Post by dpark »

EGreg wrote: post #146
dpark wrote: post #77

Earlier quoted context omitted.

> I can pretty much confirm that I have never had real Parmesan Cheese, and neither have you. That is a bizarre claim. If you’ve only ever bought pre-grated Kraft “Parmesan”, that might be true. But it’s not difficult to buy Parmigiano-Reggiano in nicer grocery stores. Also the EU has hundreds of special designations. It’s not surprising that the US would decline to give a blanket deference to EU law in this area.

While it may not be difficult, what I said is correct. Why should China respect IP of USA if USA doesn’t respect IP of Europe?

It’s not correct. We have international agreements with China and others nations broadly covering patents and copyrights. We have no such agreements covering regional appellates.

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

#150

Post by conanbatt »

woah wrote: post #72
Four_Star wrote: post #71

Earlier quoted context omitted.

If the US decided to spend trillions of dollars a year building skyscrapers in Alaska it could be 'growing' at 7% a year too. http://www.businessinsider.fr/us/china-ghost-cities-satellit...

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

Where do you think the trillions come from!
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