Chinese Economics Thread

[Franklin]

I think you are making incorrect assumptions about what is happening.

The Chinese banks don't give developers a blank cheque to borrow as much as they want, nor are they lending the money for free.

A lot of developments in China sit partially complete precisely because the Chinese banks are doing their job.

Chinese banks still carry out the same risk assessment on lenders as western banks, the big difference is that if Chinese banks decide a loan is risky, they tend not to call that in unless it's exceptionally risky. Instead they effectively hold the loan. You, as a developer isn't going to get more money from the bank unless things change drastically. But OTOH, the bank isn't going to call in your loan knowing full well you have no hope of paying it and have to declare bankruptcy as a result.

The loan is held, not written off, and will continue to accrue insterest owed to the bank, so the longer the development sits idle, the more that will eat into the developer's profit margins.

In addition, the banks would never loan you all the money for a development, so the developer will have a significant amount of their own capital tied up in the developments.

Both of those factors would work to motivate developers to find solutions to their problems rather than thinking its someone else's problem.

The Chinese knows the capitalist game well enough to know you always need to make sure people have skin in the game to ensure they are properly motivated.

Both the banks and developers would have done their homework and concluded that a project is viable and likely to succeed before the bank would agree to a loan (why many SMEs complain about not being able to get credit - they don't pass the bank's smell test).

What more, the kind of 'ghost cities' western media love to fret about would almost certainly have been green lighted, if not commissioned by the Chinese government, who would have done their own due diligence in the planning phase.

The biggest direct impact all of the Chinese controls on banks is having on real estate is keeping the prices stable.

House prices are not falling as they should be in a capitalist market forces economy from all the extra supply. That is frustrating for first time buyers struggling to scrape enough together to buy their first home, but it is a massive relief to home owners and developers.

There would be massive social unrest if people see their most valuable possession - houses, fall significantly in value. Such a house price collapse will also cause developers to scale back future developments, which would negatively impact both the availability and price of housing further down the line, after the market recovers.

What China needs to watch out for is bubbles forming in the housing market from speculation. China is controlling for that, but by not using price to do it. They are restricting the availability of capital by making it harder for people to take out a second mortgage.

Generally speaking, Chinese housing prices are still well within healthy levels when compared to international prices of similar level cities, household gearing and income.



Too big to fail only really came to prominence after 2008, but the western economies have been in relative decline since long before that.

I firmly believe the primary cause is the oversize, disproportionate and downright damaging impact of western stock markets.

The stock market is supposed to be s way to connect industry with small time investors, allowing businesses to effectively pool many small bundles of cash to generate a meaning net total that they could use to invest in the business to increase/improve productivity and so grow the business and the national economy.

Modern western stock markets now have a fundmentally different primary purpose - it is the accumulation of wealth, but rather than direct that towards industry to boost productivity, a significant, if not the majority, of that pool wealth is getting siphoned off into the pockets of a very very small number of individuals.

Rather than helping to boost national economy growth, more and more, the stock market hinders it, by taking more and more money away from productive activities, and giving it to a tiny number of people who ends in wasting massive amounts of it.

It's a very simple economic truth that you generate far more economic activity giving $1000 each to 1000 people as opposed to giving $1,000,000 to one person.

Not only do you loose out on normal economic activity, giving so much more to so few people also vastly increases the likelihood of that money being employed use and wasted.

Millionaire and billionaire playboys have very different needs and priorities to the remaining 99% of the population. But because they control so much of the wealth, they direct a disportionately large part of the economy towards building extremely expensive, niche items to satisfy their own demands while the rest of the economy suffers chronic under investment as a side effect.

America is by far the most wealthy nation in the world, yet their schools are shamefully underfunded (the vast majority of normal schools, not the super elite 1% Ivy League universities and feeder private schools funded and used by the 1%); their infrastructure is crumbling; their healthcare system for the poor is atrocious, and their industrial base is rusting away.

All of that is a direct result of the few taking way more than they have any right to, and causing the whole to suffer as a result when there isn't enough wealth and money left to cover basic, fundamental public goods and services after they have taken their lion share.

Simply put, western economies have been under forming because they are pulled way out of balance and point of optimal equilibrium by the wealth and power of the few, who use their wealth and power to change the very rules of the game to give themselves an unfair advantage, thereby allowing them to gain more wealth and power and so creating a self-sustaining cycle of greed.

Greed is not necessarily a bad thing, it motivates people to come up with break throughs and innovations. That is not only fine, it is necessary to help an economy and people keen their comparative edge.

However, when people turn their minds from legitimate pursuits what I call positivity innovation, where you come up with new technologies or find better, more efficient ways of doing things; and instead turn to what I call negative innovation, where instead of making something of real value, you only seek to game the system to get a bigger share of the pie, well, that is where your economy starts to suffer and get into trouble.

It is my belief that a core part of good governance is to be on the lookout for negative innovation and come down hard on anyone caught doing it.

The Chinese government does that, western governments does not, and there is a huge part of the reason why the Chinese economy has been able to grow so successfully so consistently without suffering the booms and busts that have become characteristic of western economies.

On China

Its well known that a lot of real estate developers are getting new loans to roll over the old ones. And even what you said is true its still better to let the developers go bust. As the banks then can take over the assets ie the houses and then sell them at auctions or sell them another way help them to recoup their loans. The problem of these loans not being called in from the developers as well as those of SOE's is that they accumulate interest as you said and in order to help out these companies the central bank has to lower interest rate to accommodate these people. This is helping to destroy wealth as it takes money away from the savers as people's savings are being eaten away by inflation. Lower interest rate spurs speculation and creates new bubbles in the economy. If the banks in China had call those loans in then China today would have higher interest rates for the savers and more affordable housing for the people.

The idea that a correction in the house prices would feul social unrest is not true. We have seen multiple stockmarket corrections in China and a housing correction earlier. No unrest resulted from either. Most people buy a house to live in and would see it as a long term wealth preserver and would not be effected by short term price fluctuations. There are speculators that are going to get burned but they took a risk and invested and lost out. No one to blame but themselves. And wealth generation in China is not driven by higher asset prices but rather by higher income.

SME's can't get loans so easily as the developers because they are not involved in government backed projects like the developers building those ghost towns and empty shopping malls.

But the biggest issue is that China need to reform the way local government is funded as they are largely dependent on land sales today which in the long run is unsustainable.

 

[Franklin]

On America

What you said about the stockmarket is true. But there is more. Of course the Too Big to Fail came to light in 2008 but those entities and their problems dates back much longer. The US has a long history of government interventions in the economy as everyone from farmers to airlines to automakers and many other industries have recieved subsidies, protectionist measures and bailouts to keep them in business. This has resulted in distortions in the economy and created many "zombies" in the economy. The biggest zombies in the US economy today are the too big to fail banks. The US over the years has also fostered a cultur of rewarding failure where CEO's who run their companies to the ground get six or seven figure sums golden handshakes and then for unknown reasons get hired again as a CEO by another company. But the biggest reason why the US economy is in the crappers today is the offshoring of jobs. This is driven by both corporate and consumer greed. The big guys want to make more and the small guys want to pay less. So you get someone from another country to work for far less money with no benefits and horrible working conditions to make your goods. But that in turn has also helped to destroy jobs and industries back home. We also need to take a closer look at where the US choose to spend its money. And that is on welfare and bailouts at home and wars and military buildups abroad by the government and foreign made consumer goods by the people. None of these activities are productive uses of capital anyway you want to look at it. And thats why debt is rising in the US while at the same time real income is falling and the infrastructure is becoming ever more dilapidated. And in the meantime the almost eight years of near 0% interest rate combined with QE money printing is creating the mother of all bubbles.

Over here in Europe its no better!

 

[Hendrik_2000]

The idea that investment in 2nd and 3rd Tier city is waste of money, is not necessarily true . There is a lag between construction and actual occupancy of the housing .
The downside is misallocation of resource but for the greater good of equalizing development and better social peace maybe small price to pay

China urbanization rate is still at 50% nowhere close to 80 or 90% of developed country.
So there will always need for housing. But due to mismatch of industrial development which concentrate mostly in larger city, There are not much taker to settle in smaller town.

They need to give incentive for industry to move to smaller town by giving tax rebate and other incentive. Scrapped the Hukou system for smaller town, Improve health facility,system and school
Eventually all those empty apartment will be filled as the smaller town will generate wealth. Using auto sales as yard stick the outlook is not bleak. Small cities are now where the action is. We can from the sales of car, cell phone, appliances etc
GM cheap no frill auto are selling like hotcake. first posted by Emperor in CDF

Tue Jul 19, 2016 5:40am EDT Related: CHINA
With Baojun, GM China has head-start in growing no-frills car market

LIUZHOU, CHINA | BY NORIHIKO SHIROUZU
REUTERS/NORIHIKO SHIROUZU

General Motors has enjoyed first-mover advantage in China's cheap, no-frills car market as foreign rivals focused on selling higher-end cars in the country's wealthier mega-cities.

But now, with sales growth in Beijing and the biggest cities stalling, other global car makers are looking more closely at selling affordable, basic cars in smaller cities and rural areas where local brands such as Geely and Great Wall Motor, and GM, dominate.

GM has been almost alone among the big foreign car makers to see the potential for selling passenger cars to the developing so-called tier-three, -four and -five cities where buyers can now afford to upgrade from noisier, uncomfortable, rear-wheel drive vans. It estimated several years ago that China's entry car segment could grow to 7 million cars a year - some way bigger than Japan's entire autos market.

GM's China chief Matt Tsien said some automakers are seeing "negative growth" in some of China's bigger cities. "But when you go into tier-three and -four cities, we saw double-digit growth for the whole of last year. It's still growing at double-digits this year and will continue," he told Reuters.

GM launched its low-end Baojun brand in 2011, catering to the needs of rural and smaller city Chinese, often buying their first car. This was no accident, Tsien says, as GM aimed to be in all corners of China, "a market of many markets," from the get-go. Baojun looks on track to sell more than 600,000 vehicles this year.

Others launched basic brands around the same time, but for most this was a half-hearted effort in part to meet a Chinese government requirement that they set up brands with local partners. After several years, BMW, Toyota Motor and Honda Motor have each launched just one or two models.

That is now changing.

Nissan Motor China chief Jun Seki told Reuters in April the company is putting more effort into its Venucia brand, with some big design changes. Nissan launched Venucia in 2012 with its China partner, but mainly sold retired Nissan models with few significant changes as 'new' Venucia cars. It sold 122,000 cars last year.

Volkswagen (VOWG_p.DE) plans to launch budget cars in the 80,000-100,000 yuan ($12,000-$15,000) bracket, including two SUVs, by 2018-19. "They will be built in China and very possibly under its own brand," VW said in a statement.

"Global automakers have largely focused on more expensive segments instead of the no-frills market that local Chinese brands have targeted," said James Chao, Asia-Pacific managing director at consultant IHS.

"Now, the lower-cost market is taking off and some global makers are finding their more premium products poorly positioned for this growth shift. And the worse news is that their product pipelines for the no-frills market is, with only a few exceptions, empty."

FRONT-SEAT VIEW

Baojun's inception owed much, Tsien says, to the 2002 creation of SAIC-GM-Wuling Auto (SGMW), a venture between GM, SAIC Motor and Guangxi Automobile Group, formerly Wuling.

Headquartered in the southern city of Liuzhou, SGMW gave GM a front-seat view of China's smaller, lower-tier cities, largely overlooked by mainstream rivals.

"In the 2000s, all the action was in tier-one and tier-two cities like Beijing and Shanghai where growth was mostly double digit," Tsien said. "But because of SGMW ... we had a window into tier-three, -four and -five cities. That helped convince us Baojun was a genuine play."

GM used existing technologies for its Baojun brand, but, unlike its rivals, it gave them a China makeover, such as beefing up suspension and axles to make them more durable for poorer road conditions.

"Our design is a little conservative, but we're creating a certain fundamental base – a root we can build on," says design chief Steve Eum, a GM veteran.

Baojun now offers six models including a multipurpose minivan and sport-utility vehicle starting from 61,000 yuan and 78,000 yuan, respectively. A hatchback will be launched this year.

Gustavo Cespedes, SGMW executive vice president, says Baojun is profitable enough to fund growth on its own, without relying on GM, SAIC or Guangxi Auto for capital. "We have aggressive growth plans (and) can fund our own growth, while providing good returns for all the shareholders," he told Reuters.

PET PROJECT

Fuelling that growth are customers like 37-year-old Zhang Tao, a pet shop owner in Linyi, a lower-tier city in Shandong province.

In 2010, Zhang quit his low-paying factory job and took a chance on opening a pet shop - just in time to ride China's domestic pet boom. Within two years, and with a second child on the way, Zhang and his wife upgraded from their Suzuki minicar to a Wuling commercial microvan, swayed by its popularity among his friends. With his annual net income now topping 100,000 yuan, he last year traded in his Wuling for a new Baojun minivan.

"My business does very well these days ... I can take my two sons, my wife, and even my parents on family outings, all sitting comfortably in this Baojun van," he said.

(Reporting By Norihiko Shirouzu; Editing by Ian Geoghegan)

 

[AndrewS]

The 2nd and 3rd tier cities currently have a huge oversupply of housing and factory space.

So yes, lower taxes should help fill this, but there are so many cities in the same situation that it simply becomes a race to the bottom, which is not in China's overall economic interest.

Getting the basic infrastructure/connectivity together is important, then each city needs to build sustainable companies, which are generally higher-value add with greater R&D input.

So a key part of this is freezing or reducing government R&D spending in the wealthy coast (particularly in Beijing which is bursting already). The provincial coastal governments and the private sector can easily afford to fund R&D from their own budgets. Additional spending can then be directed to the poorer interior.

Places like Changsha, Xi'An, Chengdu, Zhengzhou, Nanchang, Kunming etc already have a lot of universities and are large enough to support significant R&D centres that will spin off new companies.

If we look at Fraunhofer in Germany or the NSF in the USA, it gives you an idea of how much more R&D spending/personnel is required in China, and also how everything is distributed amongst lots of locations.

 

[Hendrik_2000]

So a key part of this is freezing or reducing government R&D spending in the wealthy coast (particularly in Beijing which is bursting already). The provincial coastal governments and the private sector can easily afford to fund R&D from their own budgets. Additional spending can then be directed to the poorer interior.

Places like Changsha, Xi'An, Chengdu, Zhengzhou, Nanchang, Kunming etc already have a lot of universities and are large enough to support significant R&D centres that will spin off new companies.

If we look at Fraunhofer in Germany or the NSF in the USA, it gives you an idea of how much more R&D spending/personnel is required in China, and also how everything is distributed amongst lots of locations.

But but most of Chinese population still live on the country in small villages . You just can't turn farmer into high tech entrepreneur over night. Better idea would be to empower those farmer with high tech like you said inter connectivity,platform like Ali baba and Taobao, reduce red tape, lower tax, provide start up capital,built road and broadband,The rest leave it to the people. I think most Chinese are born entrepreneur just like these guys. If story like this multiply by million. You will get rich China in no time

The Alibaba Effect: How China's eBay Transformed Village Economics

September 11, 20143:21 AM ET
Heard on

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Sun Han's furniture company is one of at least 600 in East Wind village in east China's Jiangsu province.

Frank Langfitt/NPR
The Chinese e-commerce behemoth

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is poised this week for what could be one of the biggest IPOs in Wall Street history. One reason Alibaba has been so dominant in China is its business-to-consumer platform,

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, a sort of Chinese eBay.

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Last year, Taobao and Alibaba's brand-name retail site, Tmall, drove nearly a quarter of a billion dollars in transactions.

Along the way, Taobao has even transformed village economies.

Not so long ago, East Wind village in eastern China's

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didn't have a lot going for it. The community mostly exported wheat, rice and soybean — and young men looking for a better life.

"Our village was a traditional farming village," says one of the residents, Sun Han. "People tilled the fields and raised pigs."

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Sun Han, 31, runs a furniture factory in East Wind, a so-called Taobao Village, where Alibaba's e-commerce platform helped create a furniture industry. Previously people in the village had mostly farmed wheat, rice and corn.

Frank Langfitt/NPR
Then, in 2003, Alibaba launched Taobao, which allowed people far from China's major cities to sell products online. For East Wind, that meant a whole new industry: furniture.

Today, Sun Han runs a furniture factory along the village's "Internet Business Road." Sun's factory, one of more than 600 in East Wind that now make furniture, ships all over China and as far away as New Zealand.

"Now in our village, most people own cars," says Sun, 31, who wears a pink shirt, jeans and sandals. "Not only do they own cars, they compare who owns the better car."

China has nearly 3.5 million businesses selling products on Taobao. These companies, many of them mom-and-pop operations, employ millions of people across the country.

In East Wind village, shipping firms, paint manufacturers and veneer makers have sprouted up to support the furniture industry. Handsome Zhang — really, that's his name in Mandarin — jumped into the shipping business in 2011. In his first full year, he made $50,000 — a small fortune in rural China.

"As villages develop, they become stronger," says Zhang, who wears torn jeans, sports copper-tinted hair and drives a white Kia sports car. "Taobao drives the economy. It increases migrant workers' employment opportunities. It drives everything."

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Handsome Zhang — that's his real name in Mandarin --€“ runs a shipping company, one of many supporting businesses spawned by East Wind village's furniture industry. The shipping business helped Zhang, 25, buy this Kia sports car.

Frank Langfitt/NPR
With his new wealth, Zhang, 25, dreams of touring America, though he's fuzzy on the itinerary.

"What's the capital of the U.S.?" he asks. "The Statue of Liberty is in Washington, right?"

Now in our village, most people own cars. Not only do they own cars, they compare who owns the better car.

Sun Han, who runs a furniture factory in East Wind village

Told it's actually farther north, Zhang says, "Oh, New York. I want to see New York."

In the meantime, Zhang enjoys eating out and singing in karaoke clubs while some of his peers are left to toil in factories and construction sites.

The transformation of East Wind village began about 400 miles away in Shanghai, where Sun Han stumbled into an Ikea one day.

"I saw a lot of Ikea furniture," says Sun, standing in his factory amid the whir of sawing machines and the shriek of packing tape being stretched across cardboard boxes. "I felt their structure was very simple, and the prices were pretty high. I thought if I produce and sell them, the profit would be pretty high."

Sun bought a bookshelf and found a factory to copy it. He'd already sold things on Taobao, such as prepaid phone cards, but he worried that he just didn't have the skills to run an online business.

But he taught himself how to be an Internet entrepreneur — and an effective one at that. In the beginning, in 2007, he says he made more than $1,500 a day with a staggering 100 percent profit margin.

Soon, everyone and his brother in East Wind was opening a furniture factory.

Profits have since come down to Earth. Xu Feng, who runs a veneer company here, says the furniture business is high-volume these days, but with much tighter margins.

"Market competition is very tough," Xu says. "Furniture producers are competing, and naturally they will push down the price of raw materials. So you need to lower your prices accordingly. The future will be very good. But competition will be even fiercer."

As for Sun Han, the man who knocked off Ikea, he's now trying to build his own furniture brand. He remains grateful to Taobao. Without the e-commerce platform, he says, East Wind village never would have changed.

"Young people would have kept moving to the cities and not coming back," he says. "The village would have been just old people and kids."

 

[Hendrik_2000]

It is official now The HSR makes money, completely refuting so called expert like Michael Pattis, who scorn it as white elephant, prestige project. That will never make money because the peasant are too poor to afford it.
Just heard at CCTV they plan to increase the railway line to 150,000 mile and out of it 30,000 HSR. Even at this number China is still behind US with 200,000 mile track . So still a long way to go
Via Emperor at CDF

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SHANGHAI–Four years after it started operations, the high-speed rail link connecting China’s political capital of Beijing to the commercial capital of Shanghai became profitable for the first time.

Opened to the public in July 2011, the 1,300-kilometer, or 810-mile, Beijing-Shanghai high-speed rail line has been the busiest in China’s high-speed rail system. In 2015 nearly 130 million passengers, equivalent to a tenth of the country’s population, took the bullet train between Beijing and Shanghai. Just few days after opening, the top speed on the line slowed to 300 kilometers per hour from 350 km per hour, following a fatal crash involving two high-speed trains in the southern Chinese city of Wenzhou. The journey now takes between five and six hours, depending on the number of stops.

The link’s biggest shareholder, China Railways Corp., has never released the financial performance of the line, which cost $33 billion to build. Recently, a bond prospectus issued by a minor shareholder offered a glimpse into the rail link’s financial performance.

According to Tianjin Railway Construction & Investment Holding (Group) Co., a regional railway builder, the Beijing-Shanghai high-speed rail link last year recorded a net profit of 6.6 billion yuan, or about $1 billion. It’s the first time it made a profit, said Tianjin Railway, which owns a 4.5% stake in the link. Chinese state media has often touted the line as the most profitable high-speed rail route in the world.

It sounds like good news for China’s policymakers, who have been highly dependent on infrastructure investment to drive growth. Beijing is also touting its high-speed-rail technology overseas, as part of its effort to export more high-value and sophisticated products, though the push has met setbacks in the U.S. and Mexico.

China began building the high-speed railway system in earnest more than a decade ago. It now totals 19,000 kilometers, linking all cities which have a population greater than 500,000 people. The government aims to extend the system to 30,000 kilometers by 2020. Local politicians saw a winner and proposed to build their own high-speed branch lines to connect outlying cities.

However, rapid expansion has brought mounting debt at the railway department, raising concerns about its long-term health.

China Railway Corp., the national railway operator which was overhauled from the former Ministry of Railways, said in May its debt had exceeded four trillion yuan by the first quarter of this year, almost twice as much debt as the Greek government has. In 2015, the company paid about 78 billion yuan in interest expenses, though still notched a net profit for the year of 680 million yuan.

Vast spending on rail projects continues, ballooning from 155 billion yuan in 2006 to more than 800 billion yuan last year, government data show. The government has budgeted 800 billion yuan for railway construction this year.

– Rose Yu

 

[Blackstone]

It is official now The HSR makes money, completely refuting so called expert like Michael Pattis, who scorn it as white elephant, prestige project. That will never make money because the peasant are too poor to afford it.
Just heard at CCTV they plan to increase the railway line to 150,000 mile and out of it 30,000 HSR. Even at this number China is still behind US with 200,000 mile track . So still a long way to go
Via Emperor at CDF

There's an old Chinese saying about 'if you want wealth, first build roads,' and HSR is a good example of it. That's why I disagreed with Dr. Pettis' take on HSR as white elephant projects, because the benefits to the Chinese economy and society are wider than pure profit and loss on individual HSR lines. On the other hand, a single line turning profitable doesn't refute his white elephant theory and we need more facts to test his claim. Time will tell.

 

[Hendrik_2000]

There's an old Chinese saying about 'if you want wealth, first build roads,' and HSR is a good example of it. That's why I disagreed with Dr. Pettis' take on HSR as white elephant projects, because the benefits to the Chinese economy and society are wider than pure profit and loss on individual HSR lines. On the other hand, a single line turning profitable doesn't refute his white elephant theory and we need more facts to test his claim. Time will tell.

There are tangible and intangible benefit of HSR . This the problem with the critic. They equate the viability of the railway strictly on the basis of ticket sale.

Think about it HSR improve the connectivity between city that mean migrant worker can go home more often.Factory can be located away from the city.
People has more choice as to where they want to work
Reduce auto on the highway and road mean less oil is used less pollutant, less accident.
Reduce congestion on airport

It provide catalyst for development along the route, increase real estate value etc.

Not too mention the direct benefit of employing million of people, suck up the excess capacity in steel and cement..
Spur the Chinese train technology development and their sub supplier.
Increase export of high tech instead of textile and toy
Just today Singapore and Malaysia sign agreement to build HSR between KL and Spore
Show case Chinese technology and brand name.Therefore improve the image of Chinese product and reliability which can result in million of export

So there are many benefit which critic missed to see or refuse to see

But given the high population density in eastern seaboard, They will even profitable in term of sale ticket I don't doubt it It might take a long time to recuperate the direct investment But the tangible and intangible benefit will already enrich China

Here is good article from Australia about the benefit of HSR

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[AssassinsMace]

Well it's like moving the goal post after you found out you were wrong. Four years since it's been operational and it's paid-off? That's a lot of people going somewhere. In the US infrastructure projects can take decades to make a profit. The Beijing/Shanghai line is the main thoroughfare that goes everywhere else. All the other lines benefit from it.

Let's not forget famed Western economist Nouriel Roubini who declared China's coming collapse because he said when he was in China he took a maglev train ride between Shanghai and Hangzhou, he was the only passenger on board. Yeah I'm sure he was the only one onboard since there is no maglev train route between Shanghai and Hangzhou. Now what would motivate someone, especially someone with a foremost reputation to protect, to outright lie like that. It certainly wasn't a mistake. It's because he was in an environment who wants those lies to made therefore accepted thus no risk to his reputation.

Again the narrative that HSR would go bust in China is an example of how this is really for domestic audiences. They have to show their own citizens that the West does it the best so the system doesn't change and those that benefit the most continue to get rich from it. If China is seen as doing anything better, their own citizens might want to change the system that no longer is the best. And do you think China just made an HSR system so people can take rides like they're in an amusement park? Beyond just the money made from train tickets, money is moved around and made where people go.

 

[manqiangrexue]

"...he said when he was in China he took a maglev train ride between Shanghai and Hangzhou, he was the only passenger on board. Yeah I'm sure he was the only one onboard since there is no maglev train route between Shanghai and Hangzhou."

Just got a great idea for a ghost movie LOL