The Chinese Death Star

China's raw materials bubble bursts

Wall Street Journal

propaganda rag owned by Rupert Murdoch of the FAUX NEWS NETWORK

and Royal Bank of Scotland?

aren't these some of the same criminal bankers that crashed the

world's economy ???

The Chinese Bubble is now bursting and many say it will be worse than the Lehman Brothers crash of 08.

None taken Satori.
My point is that many of the sources Kilt2 is quoting are equally dubious and his rant needs some sort of balance. I could be in minority here but his commentary seems to blame China for ALL the ills of the entire planet be they biological, financial, meteorological and military and on and on and on....
I think a reasonable argument can be made that when we are talking about a credit crisis China is one economy among many in the world that have suffered the same problems. When someone starts doing the "China is inflicting the world" I think that is so simplistic as to be almost laughable.
And when history is rewound and events from a hundred years ago are trotted out, it seems clear that someone has an agenda or is wearing the tin foil headgear.

Australia's biggest threat is China, Australian Strategic Policy ...

Saskabush wrote: None taken Satori. My point is that many of the sources Kilt2 is quoting are equally dubious and his rant needs some sort of balance. I could be in minority here but his commentary seems to blame China for ALL the ills of the entire planet be they biological, financial, meteorological and military and on and on and on.... I think a reasonable argument can be made that when we are talking about a credit crisis China is one economy among many in the world that have suffered the same problems. When someone starts doing the "China is inflicting the world" I think that is so simplistic as to be almost laughable. And when history is rewound and events from a hundred years ago are trotted out, it seems clear that someone has an agenda or is wearing the tin foil headgear.

Touchy....

Just looking to encourage a little balance. I didn't realize your opinion was the only one one allowed.

At the risk of provoking another profanity laced name calling session I would point out that China does not 'produce' Influenza. I am hoping that is just a poor choice of words but I can't be sure.

Just my opinion...

Maybe it is different in Canada than where ever you are from.

I didn't make it up I saw it in an article on economics - no doubt you will cast aspersions on Bloomberg for publishing such an article and accuse them of a tin foil hat - you twonk.

Good for you Kilt2.

No aspersions.. You are entitled tour opinion.

tour opinion???

Saskabush wrote: Wow... Talk about casting aspersions!, Simple typo... Let me correct it for you "You are entitled to your opinion." Is that better? I would have thought a smart guy like you could have figured a small typo like that out! Try and keep in mind that it is easier to make these small mistakes when I am using the whole alphabet and not all those mindless punctuation marks you are so fond of. No I am not on drugs but it seems you should be.... or something to help with your anger issues.

The opinion was an article from Bloomberg. I posted it - take it up with them.

You are critical of what exactly?

I was posting important stuff relevant to this group and some Canadian Troll starts on my case.

Crisis Gauge Rises to Record High as Swaps Avoided

Inside China's ghost cities

http://www.news.com.au/travel/travel-ideas/inside-china8217s-ghost-cities/story-e6frfqd9-1226716277487

massive cities with few inhaibitants

In China, Gross Domestic Product is divided by three sectors: Primary, Secondary and Tertiary. The Primary Industry includes Farming, Forestry, Animal Husbandry, and Fishery and accounts for around 9 percent of GDP. The Secondary sector, which includes Industry (40 percent of GDP) and Construction (9 percent of GDP) is the most important. The Tertiary sector accounts for the remaining 44 percent of total output and consist of Wholesale and Retail Trades; Transport, Storage, and Post; Financial Intermediation; Real Estate; Hotel and Catering Services and Others. 2014-02-27
http://www.tradingeconomics.com

Chanos: I actually think it’s got worse – what’s happened more recently, after the new party leaders took in, was another burst of investment, but more importantly another burst of credit expansion and what really has us concerned now is that you have credit actually accelerating in China but GDP growth still slowing – in the last quarter, China put out some staggering numbers a couple of weeks ago – new credit outstanding jumped by 1 trillion dollars US – this is an 8 trillion dollar US economy, so on an annualised rate, that’s 50% of GDP – new credit created – and to put that also in perspective, total new credit globally went up by a trillion and a half in the first quarter – China was 1 trillion of that, yet it’s only 10% of the world economy – so there is a credit bubble that is not only huge, but getting bigger.

CNBC: How do you trade this, what do you look for – what are your positions to take advantage of that

Chanos: Well, one of the things we’ve talked about historically is being short booms that go bust – and I’ve always defined that kind of very strictly in that you look for asset inflation where the asset being inflated by credit does not generate enough cash to service the debt – so you get the so called ponzi finance moment – and that would be almost anything related to real estate or construction in China – so property companies, cement companies, steel and then of course companies selling into that bubble, iron ore and mining – so inexorably you can’t keep growing your credit at 50% of GDP, something’s going to give, when – I don’t know – but it has been a pretty good place to be short.

http://fxexaminer.com/jim-chanos-on-china-bubble/

In the public sector Chinese local government debt has risen 67% to $3 trillion. According to Robert Samuelson, “local debt now equals about 33 percent of China’s economy up from 10 percent in 2008 and almost nothing in 1997.” Most of the local debt is from financing new infrastructure such as roads and bridges and from building new cities notoriously known as “ghost cities” constructed of commercial buildings that sit empty and uninhabited apartments. Tao Wang of UBS (a Swiss global financial services company) believes “dependence on this investment spending poses a dilemma for China.” If localities cut spending, the economy would be severely weakened. If localities keep spending at the same rate, localities could face default.

Ghost cities everywhere with nobody living there.

Saskabush wrote: Another viewpoint... URL:https://globalconnections.hsbc.com/us/en/articles/chinas-ghost-cities

SUMMARY
The country’s economy is now slowing, but the significance of this is not well understood.

"In the throes of crisis, generalisation is the norm; in the end, however, it pays to differentiate. Unlike the deficit-prone emerging economies that are now in trouble—whose imbalances are strikingly reminiscent of those in the Asian economies that were hit by the late-90s financial crisis—China runs a current-account surplus. As a result, there is no risk of portfolio outflows resulting from the Fed’s tapering of its monthly asset purchases. And, of course, China’s outsize backstop of $3.8 trillion in foreign-exchange reserves provides ample insurance in the event of intensified financial contagion.
Yes, China’s economy is now slowing; but the significance of this is not well understood. The downturn has nothing to do with problems in other emerging economies; in fact, it is a welcome development. It is neither desirable nor feasible for China to return to the trajectory of 10% annual growth that it achieved in the three decades after 1980.
...
For a growth-starved US economy, the transformation of its codependent partner could well be a fork in the road. One path is quite risky: If America remains stuck in its under-saving ways but finds itself without Chinese goods and capital, it will suffer higher inflation, rising interest rates, and a weaker dollar. The other path holds great opportunity: America can adopt a new growth strategy—moving away from excess consumption toward a model based on saving and investing in people, infrastructure, and capacity. In doing so, the US could draw support from exports, especially to a rebalanced China—currently its third-largest and fastest-growing major export market.
Compared with other emerging economies, China is cut from a different cloth. China emerged from the late-90s Asian financial crisis as the region’s most resilient economy, and I suspect the same will be true this time. Differentiation matters—for China, Asia, and the rest of the global economy."
Nn
The author is a faculty member at Yale University and former Chairman of Morgan Stanley Asia

http://www.financialexpress.com/news/column-china-s-growth-puzzle/1230585/1