How China Fooled the World [video]
51–60 of 79 posts
Re: How China Fooled the World [video]
#52My interpretation is that China did the heavy lifting of pulling the world out of the last crisis. Neither the US nor Germany had the political wherewithal to do large scale stimulus and/or structural reform. The Chinese also had the most to loose. The cost of propping up the global economy had been highly damaging to China's weak institutions if we are lucky it will recover in 20 years. If we are unlucky there will…
Not sure what you're talking about. The exact opposite is true. The US massively stimulated, including running up about $10 trillion in new federal public debt alone, which was a form of deficit stimulus. The Fed of course has been running hundreds of billions in annual stimulus.
I'd roughly estimate that the total US stimulus in all forms, from the treasury to the fed, totaled $15 to $20 trillion (some of which was repaid, eg loans to european banks, or the AIG and Fannie bailouts, or GM etc). That's two to three times the size of the entire Chinese economy.
That new federal debt paid federal salaries, contractors, welfare, social security, you name it. Those people then purchased hundreds of billions of dollars worth of Chinese goods.
"U.S. Bailout, Stimulus Pledges Total $11.6 Trillion"
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aZchK...
The Fed kept the entire global financial system solvent during the crash. They lent huge sums to European banks.
"the central bank lent billions to foreign banks that operate in the U.S., including Germany's Deutsche Bank Securities, which got $290 billion in mortgage securities; London-based Barclay's, which received a $47.9 billion loan; France's BNP Paribas Securities, Switzerland's UBS Securities LLC and Daiwa Securities America, a subsidiary of one of Japan's largest brokerage houses."
http://www.foxnews.com/politics/2010/12/02/federal-reserve-l...
Re: How China Fooled the World [video]
#53My interpretation is that China did the heavy lifting of pulling the world out of the last crisis. Neither the US nor Germany had the political wherewithal to do large scale stimulus and/or structural reform. The Chinese also had the most to loose. The cost of propping up the global economy had been highly damaging to China's weak institutions if we are lucky it will recover in 20 years. If we are unlucky there will…
Not sure what you're talking about. The exact opposite is true. The US massively stimulated, including running up about $10 trillion in new federal public debt alone, which was a form of deficit stimulus. The Fed of course has been running hundreds of billions in annual stimulus. I'd roughly estimate that the total US stimulus in all forms, from the treasury to the fed, totaled $15 to $20 trillion (some of which was…
Quantitative Easing has been large but it drove investment mostly in emerging markets and not in the US.
Neither fiscal or monetary stimulus is effective in a post industrial economy like the US.
Structural reform like patents, immigration, occupational licensing, taxes etc are where the big stimulus lies unfortunately.
Re: How China Fooled the World [video]
#54How many of the people commenting here read the Chinese-language press? (I mean, publications in the Chinese language from either inside or outside the region where the Communist Party of China exercises prior restraint on publication.) The one thing I've learned from studying the language, history, and culture of China since 1975 is that almost everyone who doesn't know the language is full of crazy ideas about Chin…
Native Chinese here. I guess the best way is to apply those better tools for thinking to the Chinese context. To be honest, I don't think there is much information in Chinese politics and economy worth reading. The tools we use are outdated. The information(meta data) we can get is actually very limited and very distorted. The knowledge and how people perceive the world are far behind those in developed countries. When cheap labour becomes less and less competitive, things will go south. Domestic consumer market growth does have a chance to save us, that was what I thought the best way out when I was younger. But that would never happen, when you have some understanding how the nation's stakeholders operate. This is a topic that is too big to discuss here. I do believe, sadly, there is a long dark road ahead for most of people in my country. I wish not but from where I can see I'm quite pessimistic on this. Just my 2 cents.
Re: How China Fooled the World [video]
#55Earlier quoted context omitted.
Not sure what you're talking about. The exact opposite is true. The US massively stimulated, including running up about $10 trillion in new federal public debt alone, which was a form of deficit stimulus. The Fed of course has been running hundreds of billions in annual stimulus. I'd roughly estimate that the total US stimulus in all forms, from the treasury to the fed, totaled $15 to $20 trillion (some of which was…
Quantitative Easing has been large but it drove investment mostly in emerging markets and not in the US. Neither fiscal or monetary stimulus is effective in a post industrial economy like the US. Structural reform like patents, immigration, occupational licensing, taxes etc are where the big stimulus lies unfortunately.
You're contradicting your own statement then.
You said China did the heavy lifting regarding pull the global economy out of the crash, then you say that Fed QE drove growth in emerging markets.
All that stimulus drives massive consumption, which bolsters global manufacturing. And you ignored the part where the Fed kept the entire first world solvent during the crash, that alone is more than China did.
And the US is hardly post-industrial. It's the world's largest manufacturer (yes, larger than China).
Re: How China Fooled the World [video]
#56An American ex-pat in China here. I came to China during the economic crash in 2009 and have seen it all progress the last 5 years. Yes there are random empty apartment buildings and a few absurdities like --> http://en.wikipedia.org/wiki/New_South_China_Mall . However, overall the infrastructure they have built has put this country in a position to achieve dominant superpower status over the next century. For exampl…
Ex-pat since 2007 here. Change is happening quite slowly, internal consumption is still moribund as people save to cover retirement and health expenses (social insurance isn't very strong). Even a big city like Beijing has a lot of fairly empty malls, and if you go to 2nd tier cities, you'll see new developments everywhere that are basically empty. China does have better infrastructure than say India, and its long te…
> and if you go to 2nd tier cities, you'll see new developments everywhere that are basically empty.
Malls you feel wwwaaaay over-crowded today were once empty for like 5-8 years in the 90s or 80s. Google for 烂尾楼 and you'll find a ton.
Re: How China Fooled the World [video]
#57Re: How China Fooled the World [video]
#58An American ex-pat in China here. I came to China during the economic crash in 2009 and have seen it all progress the last 5 years. Yes there are random empty apartment buildings and a few absurdities like --> http://en.wikipedia.org/wiki/New_South_China_Mall . However, overall the infrastructure they have built has put this country in a position to achieve dominant superpower status over the next century. For exampl…
overall the infrastructure they have built has put this country in a position to achieve dominant superpower status the claim that infrastructure spending leads to economic prosperity/dominance sounds pretty extraordinary to me.
Just as capital investment can lead to increased efficiency and drive growth and prosperity within a firm, public infrastructure can lead to the same type of net gains for society at large. Ultimately, it increases the rational real options available for further investment, and this creates potential future upside where none previously existed.
Re: How China Fooled the World [video]
#59How many of the people commenting here read the Chinese-language press? (I mean, publications in the Chinese language from either inside or outside the region where the Communist Party of China exercises prior restraint on publication.) The one thing I've learned from studying the language, history, and culture of China since 1975 is that almost everyone who doesn't know the language is full of crazy ideas about Chin…
Chinadaily often runs editorials directly translated from Chinese. They are quite bizarre and often just diatribes. My wife is a Chinese but has no respect for the press, so doesn't even bother reading those articles anymore (most young Chinese are the same). I've been in China for 6+ years now, I have expat friends who have been here for 10+ (which is an old hand these days). We aren't incredibly divergent in our th…
But honestly, i dont even see that as problem with China alone. Heck today it is hard to find ANY decent newspaper that are unbiased. ( In the Context of Chinese and English only ).
I dont think they are crazy ideas. Any country, be it US, UK, Japan or China have their own set of problems. Although I do generally agree that the Western World dont generally always understand the language and culture difference.
Re: How China Fooled the World [video]
#60Earlier quoted context omitted.
> the claim that infrastructure spending leads to economic prosperity/dominance sounds pretty extraordinary to me. Isn't it what the US has been claiming all the time? With the FDR New Deal theory ?
This is what Japan has been doing since their dominance in the 1980's fizzled out. In both the US/FDR case and Japan's, I believe the infrastructure spending was seen as a way to re-ignite growth while also creating something long lasting. There certainly is some truth to the long lasting piece. A country with poor infrastructure will have a very difficult time growing. What is controversial is building things either…
Oh, I'm not saying that I embrace the theory (I actually am against such policies - most of the times they are used to get people re-elected), but I was just mentioning it's still being regarded as a valid way of creating jobs and stimulating the Economy by numerous economists.