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In Some Circles, This Is Deemed Important


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HOLA4412

Again Chinese HPC does not matter!

Only the rich and middle classes are affected, i.e. 200 million people. The rest of the people the working class to speak are given accomodation as part of their jobs and house prices don't bother them one way or another.

This is rather unlike the UK where NINJAS got onto the HPI bandwagon, thus when HPC happens in China, the wealthy people get knocked back. But the rest of the population doesn't though.

AND they have things to fall back on unlike the UK, they have factories jobs a massive positive balance on their account to create jobs and infrastructure. The UK has none of these, all we've got is HPI.

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HOLA4413

Again Chinese HPC does not matter!

Only the rich and middle classes are affected, i.e. 200 million people. The rest of the people the working class to speak are given accomodation as part of their jobs and house prices don't bother them one way or another.

This is rather unlike the UK where NINJAS got onto the HPI bandwagon, thus when HPC happens in China, the wealthy people get knocked back. But the rest of the population doesn't though.

AND they have things to fall back on unlike the UK, they have factories jobs a massive positive balance on their account to create jobs and infrastructure. The UK has none of these, all we've got is HPI.

You are not looking at this in terms of the entire economy.

(i) Banks will have lent against these ridiculously over valued properties. Even with sizeable deposits, the effect will not be good

(ii) China has precious little internal demand relative to output - bankrupting the few people who can actually spend isn't going to help

(iii) Growth is created by demand. There isn't enough demand in China to feed the factories, hence they exported to the West. Western demand nosedived in 2008, they shoved it all into construction. You can build all the supply capacity you want, but without demand you simply have a rustbucket waiting to happen.

(iv) Chinese people aren't simply given accommodation for free, as well you know, unless you are referring to the dormitories for the migrant workers. I'd be amazed if your average venal Chinese factory owner doesn't take something out of their pay for it. Other housing must be paid for.

I view any stats on Chinese housing with great scepticism, but IMHO the idea Chinese housing can crash without any knock on effects is completely wrong.

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HOLA4414

You are not looking at this in terms of the entire economy.

Did you read the article on ZH today? China is gunning to be reserve currency their next 5 year plan is to move away from a export economy to an internal consumption economy. Add in trade barriers to goods made outside pumping a lot of factory workers into the consumption economy. I.e. China has options quite a few of them.

The USA and UK particularly have few as the industrial capacities of these countries is gone and there are few options other than the magic printing presses.

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HOLA4415

Did you read the article on ZH today? China is gunning to be reserve currency their next 5 year plan is to move away from a export economy to an internal consumption economy. Add in trade barriers to goods made outside pumping a lot of factory workers into the consumption economy. I.e. China has options quite a few of them.

The USA and UK particularly have few as the industrial capacities of these countries is gone and there are few options other than the magic printing presses.

I assume you mean this one? (linkies are always helpful....)

http://www.zerohedge.com/article/china-gold-demand-voracious-chinese-yuan-gold-standard

I don't really read the guns n'beans brigade but I'll take a look......

Any chance of you actually engaging with my points? :)

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