Chinese Economics Thread

[Hendrik_2000]

Tit for tat as expected via cirr
China launches anti-dumping investigation into U.S. sorghum imports

2018-02-05 09:03 CGTN Editor: Gu Liping

China has launched an anti-dumping and anti-subsidy investigation into imports of sorghum grown in the U.S., the Ministry of Commerce (MOFCOM) said in a statement on Sunday.

"This is a normal case of trade remedy investigations," said Wang Hejun, head of the ministry's Trade Remedy and Investigation Bureau.

Preliminary evidence and information found that the U.S. government had subsidized its sorghum exports, and that the volume of U.S. sorghum exported to China had increased substantially since 2013, with the prices lower than the normal value, the ministry said, noting that local producers were damaged as a result.

The ministry said it had ordered the investigation because the local industry included a large number of small growers who were unable to prepare the necessary documentation. The launch of the investigation is in accordance with the relevant laws of China and the World Trade Organization rules.

The investigation into sorghum dumping will be carried out for the period from November 1, 2016 until October 31, 2017, while an investigation of industrial injury will be from January 1, 2013 until October 31, 2017, said the ministry.

The investigation should be complete by February 4, 2019, it said, but can be extended until August 4, 2019.

Beijing's move is expected to immediately hit demand for the upcoming U.S. sorghum crop, exports of which are largely used to feed China's huge livestock sector, and could send shivers through the entire U.S. farm sector.

China is the top buyer of U.S. sorghum as well as soybeans, the US' most valuable export to the world's second-largest economy.

The US shipped 4.76 million tonnes of sorghum to China in 2017, the bulk of China's roughly five million tonnes of imports of the grain that year, and worth around 1.1 billion US dollars, according to Chinese customs data.

(With input from Reuters)

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[manqiangrexue]

Tit for tat as expected via cirr
China launches anti-dumping investigation into U.S. sorghum imports

2018-02-05 09:03 CGTN Editor: Gu Liping

China has launched an anti-dumping and anti-subsidy investigation into imports of sorghum grown in the U.S., the Ministry of Commerce (MOFCOM) said in a statement on Sunday.

"This is a normal case of trade remedy investigations," said Wang Hejun, head of the ministry's Trade Remedy and Investigation Bureau.

Preliminary evidence and information found that the U.S. government had subsidized its sorghum exports, and that the volume of U.S. sorghum exported to China had increased substantially since 2013, with the prices lower than the normal value, the ministry said, noting that local producers were damaged as a result.

The ministry said it had ordered the investigation because the local industry included a large number of small growers who were unable to prepare the necessary documentation. The launch of the investigation is in accordance with the relevant laws of China and the World Trade Organization rules.

The investigation into sorghum dumping will be carried out for the period from November 1, 2016 until October 31, 2017, while an investigation of industrial injury will be from January 1, 2013 until October 31, 2017, said the ministry.

The investigation should be complete by February 4, 2019, it said, but can be extended until August 4, 2019.

Beijing's move is expected to immediately hit demand for the upcoming U.S. sorghum crop, exports of which are largely used to feed China's huge livestock sector, and could send shivers through the entire U.S. farm sector.

China is the top buyer of U.S. sorghum as well as soybeans, the US' most valuable export to the world's second-largest economy.

The US shipped 4.76 million tonnes of sorghum to China in 2017, the bulk of China's roughly five million tonnes of imports of the grain that year, and worth around 1.1 billion US dollars, according to Chinese customs data.

(With input from Reuters)

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The findings should slap a 4 year tariff on US sorghum, starting at 30%, then 25% the second year, 20% the third year, 15% the 4th year, and be phased on by year 5 LOL

For anyone who doesn't get it, this is the exact tariff plan that Trump put on solar panels.

 

[Klon]

@Klon , Since you mentioned Deloitte I searched and found this report by Deloitte in 2016 (

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). It also says that China will overtake the US as the world's largest retail market, except by 2019.

"Compared with the growth rate of less than 5 percent in two economically developed regions of North America and Western Europe, Chinese retail market shows stronger vitality and greater growth potential, and is expected to replace the U.S. as the world's largest consumer market in 2019." - page 7

The source is listed as eMarketer report, Deloitte's own research, China E-business Research Center (CECRC), National Bureau of Statistics (NBS).

After you posted this, I found another

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from Deloitte. It says that China overtook the USA in retail sales in 2013. According to your view of the situation, this is another source that says the two markets must be close. In my view, it's another example of a firm contradicting others' reports and even it's own. I think this does confirm my point that there is no such thing as a PwC position or a Deloitte position, there are just individual reports that use whichever statistics their authors found and decided on.

I have mentioned PwC, eMarketer, Mizuho, and you have mentioned AT Kearney and Deloitte. We have found reports now, from all 5 stating that the trend is for a near and upcoming overtake of America's retail market by China's. They all agree with each other, and they don't agree with your accusation. The only way you could still be right is all these firms had rogue writers putting out bullshit, non-reviewed reports with their company's name on it AND no one, not even the company, wanted to do anything about it/correct it. I think it's a shut case now that these "contradictions" are due to something that we don't understand rather than something wrong with the data.

This is a great example of

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, in that a report that thought China is far away from overtaking the USA in this category would have no reason to mention it and would be harder to find in the context of this discussion. It's unfortunate that we haven't been able to find a report that would provide numbers for all major economies, which would at least let us see if any other countries have more retail sales than consumption.

I think you are fixated on the truthfulness of the prediction and the likelihood of the conclusion coming to pass but I'm focused on the data leading to that prediction. Maybe China's retail market won't surpass the US in 2018, or maybe it will; I'm not debating that. The point is that they are drawing from numbers that are close enough to each other for multiple large firms to predict a very near-term overtake; these are not numbers where one country is ridiculously lower than the other at the moment.

I wasn't fixated on anything, I described the assumptions underlying the prediction and why it seems they no longer hold true (according to A.T. Kearney). If you take the numbers as provided there, you can calculate that the USA's retail sales in 2018 were supposed to be 1.56 times China's in 2015 (4.4 trillion USD compared to 2.8 trillion USD). As the USA is a mature market, assuming growth at 2% between 2015 and 2018 puts American sales at 4.1 trillion USD in 2015, or 1.45 times Chinese sales that year. Not a trivial difference, particularly considering the relatively low Chinese growth since then. The growth in 2017 was 2.7% (again, all according to A.T. Kearney).

So, if my interpretation of their data is correct, they no longer expect an imminent overtaking. I also find their numbers more plausible than others', as at least they're not larger than househould final consumption expenditure.

See previous paragraph; yes it has. We have 5 out of the 5 firms (including Deloitte in case you missed this https://www.sinodefenceforum.com/chinese-economics-thread.t3715/page-842#post-494598) that we brought up all saying we are within a year or 2 of when China's market overtakes the US market. They're not predicting 100-200% annual growth in China.

Not really. Even though the numbers fluctuate significantly, they come to the same conclusion: that China's market is on the cusp of overtaking America's. That means that multiple independent studies and methods of calculation all led to the same result. It actually reinforces the conclusion. That they tend to agree on 2018 to 2019 indicates that regardless of what method is used to calculate (including what factors and ignoring what factors), the resultant ratio between this number for China and the US are very similar.

For example, if 5 labs are asked to test a drug on mice, and their conclusions are that the drug improves mouse health span (a measure of how long the subject remains healthy, not just alive, and therefore, is subject to significant interpretation which would result in fluctuating numbers) by an average of 3 months (lab A), 2 months (lab B), 2.5 months (lab C), 1.5 months (lab D), and 3.5 months (lab E), can you conclude that the drug is useless/meaningless since the results are all over the place? No! In this circumstance, the drug would be considered a great treatment, found by 5 out of 5 independent studies to be effective in increasing healthy lifespan! It's the big picture that matters, not whether independent reports have some fluctuations on the details.

Absolutely an official source, but what it's measuring may not be what these 5 firms are.

And let me point another thing out: it's basically accepted everywhere that Chinese e-commerce is the largest in the world. Given this, why is it difficult to believe that China's total retail market could also be close to being the largest in the world? To me, it makes sense.

So far, all the sources that you quoted plus all the sources that I quoted all say the same thing: that China's retail market will overtake America's soon (inferring that they must be similar in size now). I can't see this being 5 separate independent articles making the same switch-up mistake with no one in the world bothering to publicly point it out, and now, you're the first to do it on this forum. And once again, to reiterate, it's not whether China will actually surpass the US in 2018 or 2019 that I'm stressing; it's the underlying data that led them all to believe this.

If retail sales in China can at the same time be 2 trillion USD, 3 trillion USD and 5 trillion USD, that means the different sources aren't talking about the same thing and makes the room for error truly staggering, on the order of trillions of dollars. What point is there in talking about retail sales if we can't even know if they're 3 trillion or 5 trillion?
I've already stated my position on everything here. First, no number of reports saying something will convince me of that if it goes against basic facts about the economy. Second, there is selection bias in that a report that thought that China was, say, 10 or more years from overtaking the USA would have no reason to mention that and would be harder to find in this context.

See next comment for last part.

 

[Klon]

I also found another

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that is skeptical about the Mizuho report and again raises some similar points to what I've said. I'll quote the relevant part.

Amid all this positive news, the Washington Post pointed to another bit of landmark data to emerge from China when it noted: “Retail sales in China are expected to equal or surpass sales in the United States this year for the first time, another definitive marker in China’s rise to economic superpower status.”

Last year US retail sales were $5.1 trillion and those in China came in at around $5 trillion. However, thanks to the latter’s consumer spending growing at a higher, double digit pace, the Washington Post reports that analysts estimates that Chinese retail sales may have already equalled or surpassed those in the US and will finish 2018 in the top spot at $5.8 trillion.

However, while this makes for good headlines, when you look a bit more carefully this particular milestone may – like many China stats – have to be treated with a bit more caution.

The problem: what China’s National Bureau of Statistics and its American equivalent ‘call’ retail sales are rather different things. The Chinese numbers include catering (the US numbers do not) as well as an unknown but significant share of the purchases of wholesale enterprises (such as large state-owned firms). The US data, on the contrary, counts only sales to ordinary consumers. So the two sets of ‘retail’ data are counting different things.

Instead there are better ways to compare China’s consumer sector with that of the US – and these tend to support the view that the American consumer remains king.

Chart 1 shows levels for total household consumption. The US figure here is $12.8 trillion versus $4.4 trillion for China. The big discrepancy this time round is that this category includes personal spending on services (such as healthcare and education) which both tend to be much larger in America and thus distorts comparisons.

Hence it’s not the best means to compare respective levels of consumer spending in shops. Chart 2 shows a narrower data set: total household consumer spending on goods alone. All in all, this may offer the best snapshot of China’s consumer revolution. And it reveals that the Chinese still lag behind their American counterparts when it comes to what they spend at the cash register or online.

Yes, the growth rate in households’ purchases of consumer goods has been particularly impressive since 2009. But at $2.3 trillion this spending remains a little over half the US equivalent which is $4.2 trillion.

So when we think of ‘true’ retail sales, the US remains comfortably top – with China’s headline data particularly skewed by the vast amounts that companies spend on items like cars and wine. It is this corporate spend that heavily inflates the figure that grabbed the recent headline in the Washington Post.

Of course, while such an apples and oranges comparison is misleading, it doesn’t undermine the overall trend: it is only a matter of time before Chinese consumers do outspend their US counterparts, just as it is all but certain (on current growth trends) that at some point China’s GDP will overtake America’s $19 trillion economy, and become the world’s largest.

Bloomberg’s website has quite an interesting interactive tool that charts just when this might occur. For instance, at its default setting – set at 2% GDP growth for the US and 6.5% for China – the crossover year is exactly a decade from today; however, change the assumption for a lower Chinese growth rate of 4.5% (and leave the US at 2%) and that date shifts to 2037.

So, this article says that "total retail sales of consumer goods" measures something different than what is usually called retail sales. Actually, it doesn't even bother with retail sales and uses consumption data. It even has data for total household consumer spending on goods, which should be exactly what we're looking for.
I'm going to say that I fully agree with the quoted part of the article.

 

[Klon]

Some things I forgot to say.

Absolutely an official source, but what it's measuring may not be what these 5 firms are.

Exactly. But what if this is the right thing to measure?

And let me point another thing out: it's basically accepted everywhere that Chinese e-commerce is the largest in the world. Given this, why is it difficult to believe that China's total retail market could also be close to being the largest in the world? To me, it makes sense.

Why is it so easy to believe considering everything that suggests otherwise?
China has a

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, of which a larger

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goes to

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(roads, bridges, railways, etc.) and a smaller part to

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. This is also in line with the perception (see taxiya above) and

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that say that Chinese save more and that Americans are big spenders. How can these two countries have the same value of retail sales?

 

[azesus]

You need to differentiate sales between "retail goods" and "retail service", for example a pair Nike Kobe sale $200 at Foot Locker because they service you the bullshit so they charge you a low IQ fee, but I can find them for $50 at Marshall's. Just the subset element fraction goods part is the same since is China price since china service labor wage charge are lower, but in USA they charge you extra low IQ fee at the mall

 

[manqiangrexue]

Why is it so easy to believe considering everything that suggests otherwise?
China has a

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, of which a larger

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goes to

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(roads, bridges, railways, etc.) and a smaller part to

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. This is also in line with the perception (see taxiya above) and

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that say that Chinese save more and that Americans are big spenders. How can these two countries have the same value of retail sales?

OK. I believe you now. This article that you posted (

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) is what I needed to see as it is a professional saying that the statistics are not properly matched even though on the surface, they can be compared since they share the same name. I gave you a hard time because I could not believe that such a glaring issue would not be pointed out by any professionals and now I see it has. Thanks

Chart 2 is also very information as chart one says that extremely high American healthcare and education costs spiked the family consumption data to triple that of China's because these are very affordable services in China. Chart 2 shows that in actual household consumer spending on goods, in 2017, China was about $2.75T while the US was about $4.25T. Highly informative, great article.

I would like to point out, though, that in addition to this, transactions for Chinese household consumption are very very often carried out in cash, with no receipt, at low end restaurants and street markets/ underground shopping stalls and this is a huge black market that is nearly impossible to quantify accurately.

Your paragraph that I quoted here also put a large picture perspective on the economy but I did not take that as hard evidence since China has 4X the mouths to feed and basic needs to meet as the US so I'm not sure if that would or would not even the consumption out.

For anyone else reading, this is a very informative article excellent at guiding the layman through different economic numbers on Chinese-American spending:

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The biggest spender?
When will China become the world’s biggest retail market?

Jan 26, 2018 (WiC

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)

“It blows my mind,” was the verdict of one Canadian ‘old China hand’ that WiC approached last week with the news that the growth in Chinese GDP in 2017 was the equivalent of adding ‘another Canada’ to the global economy.

The comparison was cited in the Financial Times which noted that China’s economy grew 6.9% last year, “which in purchasing power parity terms” meant “growth in 2017 equalled the size of Canada’s entire economy”. The Canadian that we emailed with this revelation ruefully observed: “When I moved to China in 1985 its economy was the same size as Spain’s.”

The London-based newspaper didn’t end its comparisons there, mind you. “Three decades ago China’s gross domestic product was about $250 billion, roughly the equivalent of Finland or Chile’s current economic heft. Today just the economy of Shenzhen – the mainland city north of Hong Kong – is a third bigger at current prices. The country’s overall GDP has grown to nearly $12 trillion.”

The occasion for the article was China’s 2017 economic growth blowing through all the estimates – accelerating to its fastest pace in two years. It was higher than 2016’s growth figure of 6.7% and far exceeded a government target of 6.5%.

Amid all this positive news, the Washington Post pointed to another bit of landmark data to emerge from China when it noted: “Retail sales in China are expected to equal or surpass sales in the United States this year for the first time, another definitive marker in China’s rise to economic superpower status.”

Last year US retail sales were $5.1 trillion and those in China came in at around $5 trillion. However, thanks to the latter’s consumer spending growing at a higher, double digit pace, the Washington Post reports that analysts estimates that Chinese retail sales may have already equalled or surpassed those in the US and will finish 2018 in the top spot at $5.8 trillion.

Please, Log in or Register to view URLs content!

However, while this makes for good headlines, when you look a bit more carefully this particular milestone may – like many China stats – have to be treated with a bit more caution.

The problem: what China’s National Bureau of Statistics and its American equivalent ‘call’ retail sales are rather different things. The Chinese numbers include catering (the US numbers do not) as well as an unknown but significant share of the purchases of wholesale enterprises (such as large state-owned firms). The US data, on the contrary, counts only sales to ordinary consumers. So the two sets of ‘retail’ data are counting different things.

Instead there are better ways to compare China’s consumer sector with that of the US – and these tend to support the view that the American consumer remains king.

Chart 1 shows levels for total household consumption. The US figure here is $12.8 trillion versus $4.4 trillion for China. The big discrepancy this time round is that this category includes personal spending on services (such as healthcare and education) which both tend to be much larger in America and thus distorts comparisons.

Hence it’s not the best means to compare respective levels of consumer spending in shops. Chart 2 shows a narrower data set: total household consumer spending on goods alone. All in all, this may offer the best snapshot of China’s consumer revolution. And it reveals that the Chinese still lag behind their American counterparts when it comes to what they spend at the cash register or online.

Yes, the growth rate in households’ purchases of consumer goods has been particularly impressive since 2009. But at $2.3 trillion this spending remains a little over half the US equivalent which is $4.2 trillion.

So when we think of ‘true’ retail sales, the US remains comfortably top – with China’s headline data particularly skewed by the vast amounts that companies spend on items like cars and wine. It is this corporate spend that heavily inflates the figure that grabbed the recent headline in the Washington Post.

Of course, while such an apples and oranges comparison is misleading, it doesn’t undermine the overall trend: it is only a matter of time before Chinese consumers do outspend their US counterparts, just as it is all but certain (on current growth trends) that at some point China’s GDP will overtake America’s $19 trillion economy, and become the world’s largest.

Bloomberg’s website has quite an interesting interactive tool that charts just when this might occur. For instance, at its default setting – set at 2% GDP growth for the US and 6.5% for China – the crossover year is exactly a decade from today; however, change the assumption for a lower Chinese growth rate of 4.5% (and leave the US at 2%) and that date shifts to 2037.

Of course, a number of US and European hedge fund bosses have been wrongly betting on Chinese growth stalling to such levels (or lower) for years. They have been wrongfooted by the resilience of China’s growth and Beijing’s ability to keep the economy from crashing.

In another article this week the FT revisited this topic in its ‘Big Read’ section, asking whether these hedgies had “misread the country or were they just too early?”

That question remains to be answered but the FT did point out that those bears who had gone short China (such as Jim Chanos of Kynikos and Kyle Bass of Hayman Capital) “have mostly been forced to eat cold porridge”.

Indeed as the FT points out: “Betting against China was particularly painful last year. Investors that shorted Chinese companies listed in Hong Kong or the mainland suffered losses of more than $35 billion in 2017, almost half their stakes, according to New York-based data provider S3 Partners.”

Meanwhile if all goes to plan this year Beijing will add yet another Canada to the global economy…

 

[Jura The idiot]

now noticed the tweet

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Beijing saw a total of 878 start-ups settling in on

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Innovation Street, also known as

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’s Silicon Valley, in 2017. The startups collectively had over 7.6 billion yuan ($1.2 billion USD) of financing

 

[PiSigma]

OK. I believe you now. This article that you posted (

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) is what I needed to see as it is a professional saying that the statistics are not properly matched even though on the surface, they can be compared since they share the same name. I gave you a hard time because I could not believe that such a glaring issue would not be pointed out by any professionals and now I see it has. Thanks

Chart 2 is also very information as chart one says that extremely high American healthcare and education costs spiked the family consumption data to triple that of China's because these are very affordable services in China. Chart 2 shows that in actual household consumer spending on goods, in 2017, China was about $2.75T while the US was about $4.25T. Highly informative, great article.

I would like to point out, though, that in addition to this, transactions for Chinese household consumption are very very often carried out in cash, with no receipt, at low end restaurants and street markets/ underground shopping stalls and this is a huge black market that is nearly impossible to quantify accurately.

Your paragraph that I quoted here also put a large picture perspective on the economy but I did not take that as hard evidence since China has 4X the mouths to feed and basic needs to meet as the US so I'm not sure if that would or would not even the consumption out.

For anyone else reading, this is a very informative article excellent at guiding the layman through different economic numbers on Chinese-American spending:

Please, Log in or Register to view URLs content!

The biggest spender?
When will China become the world’s biggest retail market?

Jan 26, 2018 (WiC

Please, Log in or Register to view URLs content!

)

“It blows my mind,” was the verdict of one Canadian ‘old China hand’ that WiC approached last week with the news that the growth in Chinese GDP in 2017 was the equivalent of adding ‘another Canada’ to the global economy.

The comparison was cited in the Financial Times which noted that China’s economy grew 6.9% last year, “which in purchasing power parity terms” meant “growth in 2017 equalled the size of Canada’s entire economy”. The Canadian that we emailed with this revelation ruefully observed: “When I moved to China in 1985 its economy was the same size as Spain’s.”

The London-based newspaper didn’t end its comparisons there, mind you. “Three decades ago China’s gross domestic product was about $250 billion, roughly the equivalent of Finland or Chile’s current economic heft. Today just the economy of Shenzhen – the mainland city north of Hong Kong – is a third bigger at current prices. The country’s overall GDP has grown to nearly $12 trillion.”

The occasion for the article was China’s 2017 economic growth blowing through all the estimates – accelerating to its fastest pace in two years. It was higher than 2016’s growth figure of 6.7% and far exceeded a government target of 6.5%.

Amid all this positive news, the Washington Post pointed to another bit of landmark data to emerge from China when it noted: “Retail sales in China are expected to equal or surpass sales in the United States this year for the first time, another definitive marker in China’s rise to economic superpower status.”

Last year US retail sales were $5.1 trillion and those in China came in at around $5 trillion. However, thanks to the latter’s consumer spending growing at a higher, double digit pace, the Washington Post reports that analysts estimates that Chinese retail sales may have already equalled or surpassed those in the US and will finish 2018 in the top spot at $5.8 trillion.

Please, Log in or Register to view URLs content!

However, while this makes for good headlines, when you look a bit more carefully this particular milestone may – like many China stats – have to be treated with a bit more caution.

The problem: what China’s National Bureau of Statistics and its American equivalent ‘call’ retail sales are rather different things. The Chinese numbers include catering (the US numbers do not) as well as an unknown but significant share of the purchases of wholesale enterprises (such as large state-owned firms). The US data, on the contrary, counts only sales to ordinary consumers. So the two sets of ‘retail’ data are counting different things.

Instead there are better ways to compare China’s consumer sector with that of the US – and these tend to support the view that the American consumer remains king.

Chart 1 shows levels for total household consumption. The US figure here is $12.8 trillion versus $4.4 trillion for China. The big discrepancy this time round is that this category includes personal spending on services (such as healthcare and education) which both tend to be much larger in America and thus distorts comparisons.

Hence it’s not the best means to compare respective levels of consumer spending in shops. Chart 2 shows a narrower data set: total household consumer spending on goods alone. All in all, this may offer the best snapshot of China’s consumer revolution. And it reveals that the Chinese still lag behind their American counterparts when it comes to what they spend at the cash register or online.

Yes, the growth rate in households’ purchases of consumer goods has been particularly impressive since 2009. But at $2.3 trillion this spending remains a little over half the US equivalent which is $4.2 trillion.

So when we think of ‘true’ retail sales, the US remains comfortably top – with China’s headline data particularly skewed by the vast amounts that companies spend on items like cars and wine. It is this corporate spend that heavily inflates the figure that grabbed the recent headline in the Washington Post.

Of course, while such an apples and oranges comparison is misleading, it doesn’t undermine the overall trend: it is only a matter of time before Chinese consumers do outspend their US counterparts, just as it is all but certain (on current growth trends) that at some point China’s GDP will overtake America’s $19 trillion economy, and become the world’s largest.

Bloomberg’s website has quite an interesting interactive tool that charts just when this might occur. For instance, at its default setting – set at 2% GDP growth for the US and 6.5% for China – the crossover year is exactly a decade from today; however, change the assumption for a lower Chinese growth rate of 4.5% (and leave the US at 2%) and that date shifts to 2037.

Of course, a number of US and European hedge fund bosses have been wrongly betting on Chinese growth stalling to such levels (or lower) for years. They have been wrongfooted by the resilience of China’s growth and Beijing’s ability to keep the economy from crashing.

In another article this week the FT revisited this topic in its ‘Big Read’ section, asking whether these hedgies had “misread the country or were they just too early?”

That question remains to be answered but the FT did point out that those bears who had gone short China (such as Jim Chanos of Kynikos and Kyle Bass of Hayman Capital) “have mostly been forced to eat cold porridge”.

Indeed as the FT points out: “Betting against China was particularly painful last year. Investors that shorted Chinese companies listed in Hong Kong or the mainland suffered losses of more than $35 billion in 2017, almost half their stakes, according to New York-based data provider S3 Partners.”

Meanwhile if all goes to plan this year Beijing will add yet another Canada to the global economy…

China is not actually comparable to US on consumption in dollars because as you said before they got 4x the mouths to feed. It is more important to compare in PPP because 90% of consumption is local for foods and goods in China. In nominal dollars US is ahead and will stay ahead for a long time, unless china's Yuan appreciates significantly. The problem with all these grow another Canada a year or percent growth per year is that it is all relative. The supposedly slow down in Chinese growth is not slowing down, because in absolutely numbers, they are growing faster! They are decelerating, not slowing down. The same apply to consumption, where the price to feed one person with local produce is 1/4 the cost of US. If all we are comparing are LV handbags and Mercedes then it makes sense, but when it comes to daily goods, PPP is the way to go. The Chinese government don't give a hoot how big their consumer market is to the US, as long as they know they got leverage over foreign companies and a giant tax base from it. The key for them is growth, absolute growth and not percent.

 

[Klon]

Good discussion.

Chart 2 is also very information as chart one says that extremely high American healthcare and education costs spiked the family consumption data to triple that of China's because these are very affordable services in China. Chart 2 shows that in actual household consumer spending on goods, in 2017, China was about $2.75T while the US was about $4.25T. Highly informative, great article.

I would like to point out, though, that in addition to this, transactions for Chinese household consumption are very very often carried out in cash, with no receipt, at low end restaurants and street markets/ underground shopping stalls and this is a huge black market that is nearly impossible to quantify accurately.

Your paragraph that I quoted here also put a large picture perspective on the economy but I did not take that as hard evidence since China has 4X the mouths to feed and basic needs to meet as the US so I'm not sure if that would or would not even the consumption out.

What you mention here (and azesus above) about some things being more expensive in the USA is what

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is generally about (see

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,

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). Many

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are indeed

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in developing countries, so purchasing power is a way to measure how much you can buy with the same amount of money in different places.
In this perspective, China's consumption is indeed larger than what the nominal numbers suggest. In other words, Chinese people do buy more of many things, just that these things are cheaper.

Somewhat like what PiSigma said.

As for having four times the population, it definitely has weight, but it's as much weight as the per capita values (India is an example).