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China’s Economy Slows Sharply

nytimes.com

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Re: China’s Economy Slows Sharply

#61

Post by sct202 »

landryraccoon wrote: post #24
onlyrealcuzzo wrote: post #11

Earlier quoted context omitted.

Look -- I'm as skeptical of the Chinese miracle as anyone. But serious question: if the data was really as fake as everyone says, wouldn't the official and unofficial exchange rate of the Yuan be a lot larger? If the Chinese are basically pretending the economy has grown 500% and it's only grown 100%, wouldn't the value of the Yuan prove it?

You can fake stats sure, but can you fake the fact that everything sold in an Apple store and half the stuff on Amazon or Walmart is made in China now?

Plus we have a pretty good gauge of trillions of $ of stuff that goes into China and trillions of $ of stuff that comes out that is not the same.

Like really people, China is probably faking some stats, but they're clearly rich and making a ton of money and stuff.

Re: China’s Economy Slows Sharply

#62

Post by ct520 »

rellui wrote: post #48
contingencies wrote: post #32

These articles are coming thick and fast from three sources: The Washington Post, New York Times and Bloomberg. Nobody else (BBC, Australia, etc.) seems to be reporting the same, which leads me to believe there's a political element to this reporting, particularly amidst the current "trade war". (We don't see a rash of "US Economy Shows Sharply" every time something goes wrong for the US, although the trend is arguab…

Your post actually makes me question why it's on the top? Who's up voting it when a simple google search proves your statment wrong?

My guess, China #1

On another note interesting to see a point of view from someone that lives in China... pretty much what I expected.

Re: China’s Economy Slows Sharply

#63

Post by contingencies »

_dark_matter_ wrote: post #44
contingencies wrote: post #32

These articles are coming thick and fast from three sources: The Washington Post, New York Times and Bloomberg. Nobody else (BBC, Australia, etc.) seems to be reporting the same, which leads me to believe there's a political element to this reporting, particularly amidst the current "trade war". (We don't see a rash of "US Economy Shows Sharply" every time something goes wrong for the US, although the trend is arguab…

Given your premise that American media is reporting Chinese Economic Slowdowns more widely than other country's media, there are two options: 1. Conspiracy - They are working together, and perhaps with the government and other private entities, to sow a particular narrative 2. Profit - Their audiences are particularly interested in these stories, given the e.g. aforementioned trade war I'll leave it to the reader to…

Another respondent suggested: 3. Bubble chamber effect.

I'll leave it to you to determine whether your false dichotomy is therefore on the rocks.

Re: China’s Economy Slows Sharply

#64

Post by ct520 »

contingencies wrote: post #60
ct520 wrote: post #41

Earlier quoted context omitted.

/me Googles "bbc china economy slows" Sees that you are wrong on first assertion. If opinionated is truthy stops reading comment. next

There has been some coverage however it seems to me to be notably less frequent. Maybe because I read too much HN so catch a lot of China articles here from US sources. (Edit: Reply to below: Domestically there is a common acknowledgement of slowdown versus a few years ago, largely effecting real estate, high end discretionary spending such as luxury malls, and high end restaurants and nightclubs. I have not personal…

Gotcha, so what is your opinion living in China? Do you notice it?

Re: China’s Economy Slows Sharply

#65

Post by zachguo »

friedman23 wrote: post #43
zachguo wrote: post #34

Earlier quoted context omitted.

They would rather have a slowdown than run into a crisis.....

Sure but that is not the actual trade off. You don't prevent an economic crisis by allowing foreign investment to slow down. To use another medical analogy the idea that you can prevent an economic crisis by slowing growth is like the idea that you can cure diseases by using leeches to suck out them out. The way to prevent economic crisis is to stamp out fraud and high risk investment practices (curing the actual dis…

There's so-called economic reform, such as moving up in supply chain, cutting debts, and reducing reliance on foreign investment.

Re: China’s Economy Slows Sharply

#66

Post by malloryerik »

rrggrr wrote: post #5

I continue to believe - as I've said in prior HN comments - that the Chinese leadership welcomes this slowdown and the related trade dispute as a means to rebalance the domestic economy, while placing the blame for the rebalancing on the United States. I note that at least one distinguished China watcher agrees: https://carnegieendowment.org/2018/07/27/china-s-best-option...

Rebalancing the domestic economy toward greater household income is necessary to provide sustained growth in China, and that's what Michael Pettis argues in your link to his blog.

Make no mistake though, the national and Party leadership is deathly afraid of low growth and it is exactly what they seek to avoid. The leadership knows they must create domestic consumer demand and that this must happen through an increase in household spending or, as Michael Pettis notes, in spending on behalf of households. Low auto sales seems like evidence that this isn't happening quickly enough.

They can use the threat of trade war to convince others of the need for this shift, but actual trade war, or actual low growth? No thanks. When you are riding a tiger, you don't want it getting too hungry.

China has a long history of civil unrest, the Taiping Rebellion being a good example. Twenty to thirty million people were killed, and economic depression following a trade war was the impetus. The result of this horror was China on her knees, and is precisely what the leadership seeks to avoid. https://www.facinghistory.org/nanjing-atrocities/nation-buil...

The return to authoritarianism can be seen as battening down the hatches before the storm. Shifting spending to household income goes against powerful interests. A large national health program and social security could help, but debt funding is not an option now, and the alternative is taxing wealthy individuals and wealthy local governments. This also creates unrest.

Re: China’s Economy Slows Sharply

#67

Post by clomond »

friedman23 wrote: post #51
clomond wrote: post #39

Earlier quoted context omitted.

I've seen it in various economics articles/readings on the topic regarding the governments long term economic strategy. (see article below I found) You are also right - yes one of the biggest complains IS that many Chinese businesses are "owned" by the government with lots of influence there. However, the big resistive force here preventing this further breakup is that they are such huge employers, and it is not poli…

I'm sure there are a few technocrats that have this as one of their goals in China but ( note: this is speculation ) I doubt the reason there is friction from moving away from state sponsored businesses is changing payrolls. Communist party leaders own huge portions of their state sponsored businesses and directly benefit from their success. Chinese leaders don't want fair competition, they want to be rich.

Yes - but deploying capital in the way that brings the greatest returns is the way to become rich. Many SOEs either break even or make little money, especially when considering their size.(feel free to do research on that). You are saying they wouldn’t want to sell off some of these/make them more efficient (by liquidating some of their holdings or by laying off people who aren’t doing anything so that they can’t deploy that new capital elsewhere?). Many SOE jobs’ main utility here (from the government perspective) is to dispense wages, have people employed and keep employment numbers up. I don’t buy that the real power in China loves the current state of their SOEs.

Re: China’s Economy Slows Sharply

#68

Post by jjeaff »

sonnyblarney wrote: post #16
porpoisely wrote: post #15

I'm sure I've read this same story for the past 5 or even 10 years. I am certain that the chinese economy will face a recession one day and I am sure nobody in the media will know why or how. Maybe I'm alone in thinking these articles are such a waste of time. It tells us nothing.

No, it tells us that the Chinese economy is slowing, and by all measures it has been over the last 10 years.

And there really is not telling how much it is slowing. Especially since the Chinese government is suspected/known to provide misleading or blatantly false economic statistics for the country.

Re: China’s Economy Slows Sharply

#69

Post by amelius »

defertoreptar wrote: post #58
rrggrr wrote: post #5

I continue to believe - as I've said in prior HN comments - that the Chinese leadership welcomes this slowdown and the related trade dispute as a means to rebalance the domestic economy, while placing the blame for the rebalancing on the United States. I note that at least one distinguished China watcher agrees: https://carnegieendowment.org/2018/07/27/china-s-best-option...

Why would they want a economic slowdown?

I guess sudden economic growth can disrupt a lot of things, including potentially the structure of power.

Re: China’s Economy Slows Sharply

#70

Post by jjeaff »

sct202 wrote: post #61
landryraccoon wrote: post #24

Earlier quoted context omitted.

You can fake stats sure, but can you fake the fact that everything sold in an Apple store and half the stuff on Amazon or Walmart is made in China now?

Plus we have a pretty good gauge of trillions of $ of stuff that goes into China and trillions of $ of stuff that comes out that is not the same. Like really people, China is probably faking some stats, but they're clearly rich and making a ton of money and stuff.

You say that as if manufacturing product for someone else was a highly profitable business. There is a reason more and more has gone overseas. The margins are vanishingly small and continuing to drop.
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