Chinese Economics Thread


j17wang

Junior Member
Registered Member
You may trust Western governments. I don't. I was born in the US. By American logic they think they're an expert on China because they had a vacation there or they took a class in school or they dated an Asian... By those prerequisites I am the expert on them. Obama said that China would never be an innovative country because it lacked political freedom. China is exploding with innovation today that has the West alarmed over Made in China 2025. Why would they be alarmed when they were giving the secrets to innovation to China? It's because political freedom has nothing to do with innovation. It was a trick they wanted to pull on China into reforming politically so they can manipulate Chinese just like how social media companies are accused of evil influence across the Western world undermining democracy and what they accuse other countries of doing to them. If China is exploding with innovation, it means China has more freedom than the West is saying or you don't need political freedom to be innovated. Either case it was a lie and manipulation. If it were so good for China, why would they have lie and connect innovation with political freedom. Hugo Chavez was elected in a democratic vote yet the West rejected it. So why did the West reject a democratic vote. Was it because the government that a democracy voted for wasn't pro-West? Democratic values is not the most important. Being a subordinate to the West is. Does China want reforms to be just like the US in handling coronavirus? China certainly would've had more deaths but never mind because democratic principles are that more important. And if they cared about their democratic principles, they would've accepted Hugo Chavez as leader of Venezuela warts and all. No but instead they were hypocrites. Everyone hates a hypocrite even other hypocrites hate other hypocrites because they know what a hypocrite is motivated by their own selfishness and no one else's interests. Hence why I don't trust them.

The Europeans could've ganged-up the world to confront Trump and that would've stopped him. They don't like Trump yet they did nothing of the sort because they agree with his goals just not the method. Even with Trump as President, they still side with the US. Trump's campaign against Made in China 2025 started with Obama and the EU agreed with him. They said back then there were afraid China domestically producing key technologies would mean China wouldn't be buying it from them. Well first they had laws preventing them from selling most of those technologies to China but they still wanted China not to make it on their own. There was an article in the National Review charging how low China is at when in a poll "nice to everyone" Canada mostly hate China. That's a Western propaganda narrative that Canada is so nice and polite to everyone. Read their history on how they treated minorities and some of their acts were individually worse and more cruel than what happened in the US. It's just in the US more in numbers eclipsed the extraordinary individual cruelty Canadians inflicted. Am I going to trust Canadians who have the reputation of being environment conscience when they ship over half their garbage overseas to lesser developed countries? Any country can make themselves look clean when you ship your garbage to another country that can be taken advantage of. Where's their morally superior conscience now?

It's all these things on why they say we're supposed to trust them blindly on when it's all a lie...
As a "Canadian-Chinese" (really just Chinese since my Canadian citizenship doesn't preclude me from being treated as a second-class citizen), you nailed the Canadian narrative head-on. 100%.
 

SoupDumplings

Junior Member
Registered Member
You may trust Western governments. I don't. I was born in the US. By American logic they think they're an expert on China because they had a vacation there or they took a class in school or they dated an Asian... By those prerequisites I am the expert on them. Obama said that China would never be an innovative country because it lacked political freedom. China is exploding with innovation today that has the West alarmed over Made in China 2025. Why would they be alarmed when they were giving the secrets to innovation to China? It's because political freedom has nothing to do with innovation. It was a trick they wanted to pull on China into reforming politically so they can manipulate Chinese just like how social media companies are accused of evil influence across the Western world undermining democracy and what they accuse other countries of doing to them. If China is exploding with innovation, it means China has more freedom than the West is saying or you don't need political freedom to be innovated. Either case it was a lie and manipulation. If it were so good for China, why would they have lie and connect innovation with political freedom. Hugo Chavez was elected in a democratic vote yet the West rejected it. So why did the West reject a democratic vote. Was it because the government that a democracy voted for wasn't pro-West? Democratic values is not the most important. Being a subordinate to the West is. Does China want reforms to be just like the US in handling coronavirus? China certainly would've had more deaths but never mind because democratic principles are that more important. And if they cared about their democratic principles, they would've accepted Hugo Chavez as leader of Venezuela warts and all. No but instead they were hypocrites. Everyone hates a hypocrite even other hypocrites hate other hypocrites because they know what a hypocrite is motivated by their own selfishness and no one else's interests. Hence why I don't trust them.

The Europeans could've ganged-up the world to confront Trump and that would've stopped him. They don't like Trump yet they did nothing of the sort because they agree with his goals just not the method. Even with Trump as President, they still side with the US. Trump's campaign against Made in China 2025 started with Obama and the EU agreed with him. They said back then there were afraid China domestically producing key technologies would mean China wouldn't be buying it from them. Well first they had laws preventing them from selling most of those technologies to China but they still wanted China not to make it on their own. There was an article in the National Review charging how low China is at when in a poll "nice to everyone" Canada mostly hate China. That's a Western propaganda narrative that Canada is so nice and polite to everyone. Read their history on how they treated minorities and some of their acts were individually worse and more cruel than what happened in the US. It's just in the US more in numbers eclipsed the extraordinary individual cruelty Canadians inflicted. Am I going to trust Canadians who have the reputation of being environment conscience when they ship over half their garbage overseas to lesser developed countries? Any country can make themselves look clean when you ship your garbage to another country that can be taken advantage of. Where's their morally superior conscience now?

It's all these things on why they say we're supposed to trust them blindly on when it's all a lie...
I doubt many people here trusts the US (just look at latin america, the middle east etc...) but Petrolicious88 wasn't advocating for democracy. Petrolicious88 was advocating for more reforms. China mustn't trust the West's words, but China can still copy and implement reforms from the West that made them strong. I feel like the West overly attributes many of their strength to democracy, rather than to their strong institutions. Look at Singapore. It has one of the worst press freedoms in the world, yet it is ranked No. 1 in term of innovation. Singapore was able to copy and adapt the West's institutions. Imagine how powerful China can become if she does the same?

The West still has a lot of things China can learn from. China should do what she can to absorb the useful bits to speed up development.
You can download this book online. I recommend chapter 7, Opening the Window without Letting the Flies and Mosquitoes In. It talks about how China attracts foreign talent and investors while limiting their ideology.
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SoupDumplings

Junior Member
Registered Member
As a "Canadian-Chinese" (really just Chinese since my Canadian citizenship doesn't preclude me from being treated as a second-class citizen), you nailed the Canadian narrative head-on. 100%.
Yeah, it's really hypocritical of Canada to complain when it had its residential schooling until 1996. Now the government gets to reap the benefits of all the good land, while paying a small compensation fee. I predict that this will be Tibet and Xinjiang in around 20 years, when a new generation of less hardened Chinese leaders come around.
 

ansy1968

Junior Member
Registered Member
I think what he/she means is that when politicians or countries don't face threats (internal and external), they get lazy, and degrade their institutions. Just look at how deluded the US had become since the USSR fell. With China's massive SOEs and reliance on guanxi, there are bound to be many princlings and politicians that prefer the status quo in order to get rich rather than reform to make the country stronger. This would hold back China's reform. An external threat like the US would provide the incentive to push through painful but important reforms. It would be terrible if China's politicans end up like those in the US with their heads in the clouds.

An easy example I can think of is Zhu RongJi's reform of the SOEs in the early 2000s that laid off millions of workers, but now after 2 decades have made China's SOEs much more innovative, efficient and profitable. And there are probably more examples out there.
hi SoupDumplings

Modern China had a Turbulent history, its reform or die situation. For a huge population with its aspiration , it need a collective will and good leadership to achieved. For me its superior to western system, cause its always UNDER THREAT, this keep them on their toe and more responsive to people complaint. In The western democratic system where you have a 4 or 6 years election cycle, thing is not being done and become complacent. Its being corrupted by big corporation and the ordinary citizen have no say, now which one is more democratic.

China needs reform cause it has to, Government had control over big corporation (SOE and BIG TECH) and not the other way around, it has a National objective and putting all its resource to achieve it.
 

AssassinsMace

Brigadier
I doubt many people here trusts the US (just look at latin america, the middle east etc...) but Petrolicious88 wasn't advocating for democracy. Petrolicious88 was advocating for more reforms. China mustn't trust the West's words, but China can still copy and implement reforms from the West that made them strong. I feel like the West overly attributes many of their strength to democracy, rather than to their strong institutions. Look at Singapore. It has one of the worst press freedoms in the world, yet it is ranked No. 1 in term of innovation. Singapore was able to copy and adapt the West's institutions. Imagine how powerful China can become if she does the same?

The West still has a lot of things China can learn from. China should do what she can to absorb the useful bits to speed up development.
You can download this book online. I recommend chapter 7, Opening the Window without Letting the Flies and Mosquitoes In. It talks about how China attracts foreign talent and investors while limiting their ideology.
Please, Log in or Register to view URLs content!
I have no problem with anything the West has to offer being good for China. I just have a problem if the West dictates what those reforms have to be. The Chinese should be able to choose themselves not the West. Just like I want democracy for China. It's the US that thinks they have the final okay who a country picks like what happened with Hugo Chavez which I'm not okay with. Democracy is not real if the US gets the final say over who the people get to vote for. You know why the West's more important reforms they want for China is in financial sectors? It's because they want to quickly take money from China just like what happened in the 2008 Western Financial Crisis that put Europeans countries in a bind when US and British entities pulled their money out to save themselves. You know what else reforms they want? They want China to obey the rules and not make any themselves. Like look at what happened with Libya. It was the US and British that set rules and told no one to do business with Libya because of how they sponsor terrorism for years. And it was the US and Great Britain that got to decide to lift the embargo without consultation of any other countries and then they got the most lucrative deals with Libya. That's the stuff they leave out. All the fine print that leaves them in control when you embrace them.
 
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SoupDumplings

Junior Member
Registered Member
I have no problem with anything the West has to offer being good for China. I just have a problem if the West dictates what those reforms have to be. The Chinese should be able to choose themselves not the West. Just like I want democracy for China. It's the US that thinks they have the final okay who a country picks like what happened with Hugo Chavez which I'm not okay with. Democracy is not real if the US gets the final say over who the people get to vote for. You know why the West's more important reforms they want for China is in financial sectors? It's because they want to quickly take money from China just like what happened in the 2008 Western Financial Crisis that put Europeans countries in when US and British entities pulled their money out to save themselves. You know what else reforms they want? They want China to obey the rules and not make any themselves. Like look at what happened with Libya. It was the US and British that set rules and told no one to do business with Libya because of how they sponsor terrorism for years. And it was the US and Great Britain that got to decide to lift the embargo without consultation of any other countries and then they got the most lucrative deals with Libya. That's the stuff they leave out. All the fine print that leaves them in control when you embrace them.
I agree with you. But following the Phase 1 deal, China has been opening up it's financial markets. What do you think about it? Could it boost confidence in foreign investors, thereby increasing FDI? Or could they be trying to steal China's wealth.
 

AssassinsMace

Brigadier
I agree with you. But following the Phase 1 deal, China has been opening up it's financial markets. What do you think about it? Could it boost confidence in foreign investors, thereby increasing FDI? Or could they be trying to steal China's wealth.
Well if the US is still complaining then it hasn't gone far enough for the US meaning Beijing still has control.
 

dankris

Junior Member
Registered Member
Guys, this is an economic thread. Let's keep it that way and put the politics on the sideline. We've got enough dose of politics from our daily news already.
 

KYli

Senior Member
Chinese banks, brokers, insurance companies have near monopoly in China. These companies are no longer fragile companies that need protection. Foreign competition might bring necessary change for them to better compete in the international stage. Beside, Tencent and Alibaba probably pose a bigger threat to all of them if regulations are loosing up some more.
 

weig2000

Junior Member
In search of answers to the perennial question: why China's economy refuses to collapse?

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The country’s rapid rebound from the coronavirus means it’s poised for another year of growth while the U.S. contracts.

By Tom Orlik

Don’t tell President Trump, but China is winning.

The U.S. has thousands of
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. China’s reported daily case count is
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. The U.S. is braced for an historic 6% contraction in gross domestic product. China’s rapid rebound means it’s poised for another year of growth—and a speedier catch-up in the race to overtake the U.S. as the world’s biggest economy. America’s international standing has seldom been lower. From the corridors of the World Health Organization to the protest-ridden streets of Hong Kong, China’s global clout increases.

For many, China’s world-beating rebound must come as a surprise. To read the history of China analysis in the last 30 years is to be bombarded with predictions of imminent demise. Sure, the skeptics conceded, double-digit growth looked impressive. But, they said, just poke beneath the surface, and the reality was an unsustainable bubble. The authoritarian political system was too constricting for the economy to truly thrive. Banks were
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. The industrial landscape was littered with zombie companies, the urban landscape with ghost towns.

At first, it appeared Covid-19 would confirm that narrative. Reports about a virus contracted from bats and spread in a crowded wet market confirmed prejudices about a primitive and backward people.
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—the whistleblower who tried to alert China’s authorities but had been silenced—affirmed the superiority of the open U.S. system. Footage of mechanical drones barking “go home” at lockdown dodgers added fears about the rise of a surveillance superstate.

The lockdown hammered China’s economy. With factories closed, profits for state-owned enterprises slumped, falling close to 50% in the first months of the year. Home sales—a critical driver of China’s construction boom—plummeted. Tax revenue and land sales, which are the main source of revenue for local governments, followed them down. Workers faced rising unemployment and shrinking incomes. The official data showed the jobless rate rising above 6%. Cynics assumed the reality was worse.

In the grizzly bear narrative, the arch villain in China’s economy is debt. A four-trillion-yuan ($565 billion) stimulus that started as a powerful response to the 2008 great financial crisis ran too strong for too long.
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as a whole rose precipitately—climbing from 140% of GDP in 2008 all the way to 260% in 2019. Everyone from International Monetary Fund policy wonks to Wall Street money managers to China’s own communist cadres were warning of a dangerous bubble.

The biggest borrowers—state-owned enterprises, real estate developers, local governments—were the very same groups that were now facing plunging incomes as Covid-19 swept through the economy. Surely the day of reckoning was nigh.

For some in the Trump administration, it seemed like a good moment for a victory lap. China’s outbreak would “accelerate the return of jobs to North America” said Wilbur Ross, the commerce secretary. Back at the end of January, when China had the virus and the U.S. did not, that seemed tone-deaf to human suffering. A few months later, with China in recovery mode and the U.S. reporting 2.2 million cases, it’s clear that it was also off-base on where the economic costs would fall.

Beijing took action on Feb. 1, a Saturday. For more than a week, China’s financial markets had been closed, an extended break as policymakers kept the 1.4 billion population on lockdown for the Lunar New Year holiday. On Monday, they opened again. With traders scrambling to price in a plethora of bad news—from a rising case count to falling markets in the U.S. and Europe—there was only one way the markets could go: down.

In a show of strength, the People’s Bank of China, the China Banking and Insurance Regulatory Commission, and the State Administration of Foreign Exchange issued a joint statement, committing to stabilize the market and
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to small businesses stretched to the breaking point by the lockdown. More action followed. The People’s Bank of China injected 1.7 trillion yuan into the economy—a record slug of cash aimed at calming nervous markets. Interest rates were cut. Bearish short sellers faced new regulatory constraints. And cash-rich insurance funds were given a clear signal: Buy stocks now.

It worked. A drop in stocks was inevitable, but with the assurance of strong support from Beijing the market quickly regained lost ground. The yuan, a crucial gauge of investor confidence, moved back to the strong side of 7 to the dollar. China’s seven-day repo rate, the beating heart of the financial system, stayed low and stable, showing banks had no shortage of funds.

With the financial system steady, policy focused on plugging the gaps for businesses and households—preventing the lockdowns necessary to control the pandemic from triggering a downward spiral of bankruptcies and unemployment. Banks were told to go easy on borrowers. Nationwide, small enterprises and companies got a holiday on loan repayments. In Hubei, the epicenter of the outbreak, big ones were off the hook too. Fiscal policy shifted to reduce the burden on business, freeing up cash flow. An accountant at a cinema in the northern metropolis of Tianjin says breaks on taxes and social security contributions helped keep the lights on through the lockdown.

Major corporations, from state-owned dinosaurs to gleaming new tech titans, swung into action. From long experience, state-owned companies know the crisis drill—no letting workers go, no turning off the investment taps, keep money flowing through the system. Tencent Holdings Ltd. and Alibaba Group Holding Ltd., tech giants whose payment and messaging apps are the digital arteries of China’s economy, created add-ons that enabled the government to judge who could leave the house safely. Leveraging its payments network, Alibaba provided cut-price loans to small businesses and street vendors, helping keep them afloat through the lockdown.

The outcome will be far from perfect. China is poised for the
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of the reform era. Bloomberg Economics’ forecast is for GDP to expand 2.1% in 2020, down from 6.1% in 2019 and the lowest since the start of Deng Xiaoping’s reform and opening in 1978. But a system-shaking crisis has been avoided. Markets are stable. Banks are still standing.

How did China manage once again to defy the doubters? The answer—as I argue in my new book, China: The Bubble That Never Pops—lies in the strengths of a system that are hiding in plain sight: rock-solid funding for the banks, state intervention that can be more strength than weakness, and the competitive edge that comes from enormous size.
To be continued...
 

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