Chinese Economics Thread

Xizor

Captain
Registered Member
An opinion piece on the trade deal from Al Jazeera
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Did China capitulate to the US on 'beautiful monster' trade deal?

The deal, whichever way you choose to break it down, is a win for Trump who argues the agreement delivers "economic justice" for the country.

Has Xi wasted the political capital he established?

China's treatment of 13 million Uighur Muslims, tactics against democracy protesters in Hong Kong, and removal of presidential term limits - giving Xi indefinite power to stay as leader - have created uncertainty, cramping growth both at home and abroad.

Try a bit to be covert perhaps? Sheesh. Some people have bought the uighur concentration camp story lock stock and barrel. Wahhabi Islamic terrorism supporters.

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The sooner the west realizes that the real enemies are their "allies" in Middle East and the real friends are the accused Axis of Evil - the better for humanity.



 
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occupatio

Just Hatched
Registered Member
Al Jazeera was a joke in the West. Then they hired Westerners to run it and give it legitimacy. It's a propaganda arm of conservatives of the West.
That's an oversimplification. It is a media outlet of Qatar, which like Saudi Arabia also hosts US bases. But Qatar supports the Muslim Brotherhood, just as Obama did, while SA considers it a threat to its rule. In these areas, Qatar and SA and US foreign policy are not all aligned in their objectives in the Middle East.
 

AssassinsMace

Lieutenant General
That's an oversimplification. It is a media outlet of Qatar, which like Saudi Arabia also hosts US bases. But Qatar supports the Muslim Brotherhood, just as Obama did, while SA considers it a threat to its rule. In these areas, Qatar and SA and US foreign policy are not all aligned in their objectives in the Middle East.

Yes, that's when the West saw it as a joke then they hired some Westerners to run it. That's why they repeat news and opinions that you would see in traditional conservative news outlets in the West.
 

occupatio

Just Hatched
Registered Member
It was reported in Chinese media that the phase one trade deal had 80 something instances of 'China shall not' and only 5 instances of 'US shall not' in the language of the text, using this as fodder for saying it is an 'unequal treaty'. That may be true in the tone of the language but rather misses the point, which is that the phase one deal serves to stall for time, which is ultimately what is important. More time, more development, more time to surpass the US.

I did glance at the text, and found the entrance of US finance into the Chinese system to be potentially worrying. But there is nothing in the text that gives specific details about how this would work. The main issue being taking in US finance capital while also quarantining its possible destabilizing effects.
 

occupatio

Just Hatched
Registered Member
Yes, that's when the West saw it as a joke then they hired some Westerners to run it. That's why they repeat news and opinions that you would see in traditional conservative news outlets in the West.
Nod, I now see what you're responding to. Al Jazeera may do its own reporting in the ME, for whatever that's worth, but anything outside that sphere, like 'reporting' on China, I expect to be like everyone else in Anglophone media, which is just propagating what comes out of the Associated Press, based in Washington DC. Who cares what they say about China, it's just the same flavor, different packaging.
 

plawolf

Lieutenant General
Al Jazeera is toeing the western party line on China to ‘buy’ legitimacy and credibility within the western MSM, because China is not a core issue for them that they care enough to have an independent opinion and defend it. Notice how the western media doesn’t bother going after it as much as they did during the earlier Afghanistan and Iraq years. Back then Al Jazeera was demonised more than RT or Chinese CCTV.

I think the degree of western assimilation of Al Jazeera is directly inversely proportionate to the amount of effort western MSM devoted to discrediting it.
 

plawolf

Lieutenant General
I did glance at the text, and found the entrance of US finance into the Chinese system to be potentially worrying. But there is nothing in the text that gives specific details about how this would work. The main issue being taking in US finance capital while also quarantining its possible destabilizing effects.

Western financial institutions will be neutered so long as capital controls remain in place and Chinese central banks remain independent.

Western financial institutions are not magical or have godly powers. They are only as big and powerful as they are in the west today because of many complex and interlocking factors, some of the main ones being:

-state capture. The financial sector is so overwhelmingly important in most western countries that governments bends to the will of them, and make ridiculous concessions and tailor make rules to benefit them.

-preferential treatment from central banks, and market regulators, especially in terms of interests and fees. Many of their trading models would simply not be viable without this highly tilted playing field.

-insider trading and effective collusion between all the major firms. Just look at the recent London Libor scandal as a perfect example of how deep and wide insider trading and collusion is. And that is just what has been made public. I have friends who worked in the city who have seen far worse first hand.

Also, even without co-ordination, there is a massive amount of group think because most western financial institutions because they all use the same methods and inputs (excluding insider info when looking at the industry at the macro level), so its little wonder they all arrive at the same result. When the majority of financial institutions who collectively control the vast majority of capital in the markets all arrive at the same or similar answer, that moves markets even if they are all completely wrong.

A good analogy would be if a class who has been taught together were taking an exam together at the end of the year, and then their answers were used as votes to decide the ‘correct’ answer.

Capital controls would limit both the ability of western financial institutions to collude through groupthink; and reduce the harmful impact on the economy of vast amounts of hot money rushing in and out, distorting markets.

Lack of state capture would mean western financial institutions won’t get the highly unfairly preferential treatment they currently enjoy in the west. No doubt this lack of favouritism would be spun as some sinister state interference in the western MSM.

But if forced to play on a level playing field, I have confidence western financial institutions would dominate the domestic Chinese market the same way western manufacturing and retail/sales companies are dominating the domestic Chinese market now.

Western firms have only dominated once they entered developing markets because they were able to exploit their size and influence to use highly uncompetitive means to kill off all local domestic competition and then switch over to profit maximisation mode.

China has always been very good at stopping them from doing this, hence all the BS complaints by western companies about ‘unfair’ trade practices. They are just not used to a fair and effective regulator keeping their dirty tricks at bay.

Anyone who has actually been in China would know first hand just how much more dynamic, competitive and diversified the Chinese domestic market is. And correspondingly, the customer experience is leagues ahead of what you can expect in the west. That’s not what you get from uncompetitive crony capitalism. Ironically, it is the west that suffers much more for legalised crony capitalism.
 

Tam

Brigadier
Registered Member
Highly suggested to read it in its entirety.

Quotes from a very good article:

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"To begin with, the trade war has had only a marginal impact on the Chinese economy. Exports to the U.S. has indeed fallen by some 8% in 2019. However, total Chinese exports have barely budged, down by a minuscule 0.03% in 2019. In other words, China has been able to export a lot more to other countries, especially Europe and ASEAN, which has almost fully compensated for the fall in exports to the U.S. This in turn suggests that many Chinese companies are sufficiently agile and competitive to win sales in new markets in a tough global economic environment, which is in sharp contrast to the stereotype of slumbering and unimaginative Chinese SOEs (state-owned enterprises)."

"Furthermore, China’s growth rate in nominal terms has picked up strongly, reaching 9.6% year-on-year. This is important because it is the nominal growth rate that really counts when it comes to an economy’s ability to service its debts. With the average nominal interest rate in China at around 7% and its economy growing at close to 10%, the economy overall is able to service its debts comfortably."

"If we really have to make comparisons with China’s GDP growth, it is far more instructive to compare how much China is adding to the world economy compared with the U.S. China’s GDP now stands at $14.2 trillion in nominal U.S. dollars. At a nominal growth rate of 9.6%, it is adding some $1.36 trillion to the global economy. In comparison, America’s GDP at $20.5 trillion is adding only $0.7 trillion to the global economy at an estimated 3.5% nominal growth. This is about half of China’s contribution."
 
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