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an interesting view that tallies somewhat with my own.

http://uk.biz.yahoo.com//24102005/323/chin...on-advisor.html

the rates of growth that we have seen in the Chinese economy of late are unusual, and history shows that any economy booming so much invariably falls into a period of retrenchment equally rapidly.

as they own so much of our debt, one would expect them to go down with us when the bust hits the west. The very nature of the globalised economy dictates that the coming "correction" is almost certain to be global, and more synchronised than previous ones. Look at how the US is catching up with us in the cycle.

So for those who are worried about the Chinese seizing their destiny as the sun sets on the west, I simply say this..."don't" (excuse the Bliarisms) ;)

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The government has also expressed concern that runaway demand for oil and other resources is putting a strain on transportation systems while too much investment in property developments could lead to financial problems.

It always amazes me when economic commentators are seemingly taken by surprise when overcapacity and over speculation result in problems like this. :huh:

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I don't think it's warranted.

yes the chinese economy will slow a bit but a rate of 5% growth is still bloody respectable.

pay attention to the domestic economy rather than the exports,that'll give you a better clue as to whether it is sustainable.

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I don't think it's warranted.

yes the chinese economy will slow a bit but a rate of 5% growth is still bloody respectable.

pay attention to the domestic economy rather than the exports,that'll give you a better clue as to whether it is sustainable.

I can't see their economy being reliant on the west.

They have had high growth for 30 years, and have the largest domestic market in the world.

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I can't see their economy being reliant on the west.

They have had high growth for 30 years, and have the largest domestic market in the world.

I'm no expert in this field by any means. From what little I know though, most of the growth has been stimulated by demand from over here. They produce more for us than they do for their domestic market. In turn, the domestic market is stimulated by the growth created through Western demand... a virtuous circle, so long as we keep buying their produce

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I'm no expert in this field by any means. From what little I know though, most of the growth has been stimulated by demand from over here. They produce more for us than they do for their domestic market. In turn, the domestic market is stimulated by the growth created through Western demand... a virtuous circle, so long as we keep buying their produce

For 18 out of the last 20 centuries China has been the largest economy in the world.

They will be the largest economy again this century.

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For 18 out of the last 20 centuries China has been the largest economy in the world.

They will be the largest economy again this century.

presumably the last two?

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I'm no expert in this field by any means. From what little I know though, most of the growth has been stimulated by demand from over here. They produce more for us than they do for their domestic market. In turn, the domestic market is stimulated by the growth created through Western demand... a virtuous circle, so long as we keep buying their produce

Ignore this stuff about a high savings rate - its utter and total nonsense. You want to know what will occur?

Because of the high savings rate, there is more real money to borrow for economic activities. This means more investments chasing this high return. All these investments bad or good will carry on until the communist monopolies are broken and overall profit growth will fall as more and more businesses compete for markets - each makes less profit. However, as the profits shrink the economic activity will rise until only small returns are available. When this occurs - and interest rates are low the society will reach a very advanced state.

General living standards will rise as overall profits decline through competition, and thus the economy grows ever more advanced. In this economy labour (not landlords) are rewarded much more to advance the capital of production by increasing thier skillsets. All advanced economies grow at a few percent a year at best - but living standards exceed anything that had gone before.

It is the same story as Japan, S.Korea, Taiwan etc... But on a bigger scale.

The best more advanced economy is where everyone has to work for a living, because returns are so low in general, and rentiers cannot exist as competition will instantly eat them alive. Savings from salary make up the bulk of thier pension pot. But living standards - what you can buy with your wage - are superb.

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as carefree as the wind from the wing of a butterfly sings. i dont think they are worried. as soon as the chinese inflation figures rise into double figures they will simply bring on an ancient warrior, who using the power of his ancestors will karate chop the figure in half with one sure, swift blow.

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Japan with a population of appromately 100m people achieve growth of about 10% for 30years. China with a population of over 1b people have had growth rates of 10% for a shade over 10 years. They have enough people wanting to climb out of poverty to keep their growth going for quite sometime yet.

Sometimes I think these clever economists get a little too clever for their own good sometimes. Chinese growth is not going to slow for at least another 30 years IMO.

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Ignore this stuff about a high savings rate - its utter and total nonsense. You want to know what will occur?

Because of the high savings rate, there is more real money to borrow for economic activities. This means more investments chasing this high return. All these investments bad or good will carry on until the communist monopolies are broken and overall profit growth will fall as more and more businesses compete for markets - each makes less profit. However, as the profits shrink the economic activity will rise until only small returns are available. When this occurs - and interest rates are low the society will reach a very advanced state.

General living standards will rise as overall profits decline through competition, and thus the economy grows ever more advanced. In this economy labour (not landlords) are rewarded much more to advance the capital of production by increasing thier skillsets. All advanced economies grow at a few percent a year at best - but living standards exceed anything that had gone before.

It is the same story as Japan, S.Korea, Taiwan etc... But on a bigger scale.

The best more advanced economy is where everyone has to work for a living, because returns are so low in general, and rentiers cannot exist as competition will instantly eat them alive. Savings from salary make up the bulk of thier pension pot. But living standards - what you can buy with your wage - are superb.

An unusually cheerful post from you, BC. I don't see how it squares with what is going on here, and why you think we will suffer a rentier class, whilst China won't?

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China is creating real jobs, this country on the whole is not. Look at the skilled emigration stats, the skilled jobs and opportunities don't exists for many. Biggest may be when the over-indebted youngsters of today don't start their own business in 10-15 years time. China have tried to stamp on their housing boom to prevent inflation and distortions negatively affecting their economy, our policitians have done the opposite.

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Guest Riser

Don't know about anyone else but I have a real problem seeing our leaders visiting China and sucking up to their leaders. It wasn't that long ago they were running over students in tanks and last night there was an article on communist gangs forcibly injecting women in the stomach to abort second children. While most countries have their own dirty washing I do wish our politicians and industry leaders would have some moral fiber when it comes to dealing with this Chinese regime.

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Japan with a population of appromately 100m people achieve growth of about 10% for 30years. China with a population of over 1b people have had growth rates of 10% for a shade over 10 years. They have enough people wanting to climb out of poverty to keep their growth going for quite sometime yet.

Sometimes I think these clever economists get a little too clever for their own good sometimes. Chinese growth is not going to slow for at least another 30 years IMO.

Let us not forget that the rising cost of oil will also affect the Chinese, who seem to be following a model of "development" that was employed by the west in a time when oil was cheap and plentiful.

to draw an analogy... the Chinese are entering the market just as it is turning the other way. If the future is to be more localised and agrarian then they might regret de-skilling their population in that respect.

Just a thought. B)

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China's growth is a process that may be interupted through bad bank loans etc.., but will carry on, at a high rate, as the high level of savings produce a high non-inflationary level of investment. Consumption (demand) will grow through rising real incomes from the increased range of products per currecy unit. While there may be a malinvestment bubble in some cities, and the banking system is corrupt, the local and provincial goverment is corrupt, the investment and increased real jobs will eventually lower the profit rate, and growth through technological advancement will increase.

Land owner/(LORD) economies are like a black hole to the growth of capital stock as rents and high property prices reduce peoples consumption to subsistance and ownership to a few posessions. A power system take hold of the propertied over the non propertied.

From a brief period of advancement in the Ming period, China has been in the grip of a landlord/rentier class for most of the Qing Dynasty(1644-1911). This landlord economy became a argerian state run economy after Mao, but during the last 20 years massive polictical changes inside the communist elite are opening up to the process of capitalism, the persuit of profit and market choice, which means investment in both physical and human capital and advancement in the population.

We however, are in landlord economy, where the equity of the propertied class dwarfs anything else, and the high property prices and political control to land owners (tax breaks etc..) polarise credit to a propertied class with huge equity, the rest tenants facing rising rents and taxes.

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Chinese growth is not going to slow for at least another 30 years IMO.

It might happen. But it probably won't. Nobody's very good at projecting three decades hence. Really, we’re not very good at predicting half a decade out. There weren’t many experts in 1987 predicting that by 1992 the Berlin Wall, the Warsaw Pact and the Soviet Union would all have fallen.

There are plenty of reasons to assume that some disaster will stop China's rise to superpower status. We know that China has immense social problems. For example, since China introduced its “one child” policy in 1978, the imbalance between the sexes has increased to the point where there are 119 boys for every 100 girls. The pioneer generation of that 20% male surplus is reaching manhood now. What’s going to happen to those young men? As a general rule, large numbers of excitable lads who can’t get any action are useful only for cannon fodder. Add in the ever widening disparities between the glittering coastal cities and an impoverished rural backwater, well, that certainly sounds a likely candidate for some huge social upheaval. All we have now is a thin veneer of consumer goods masking the junta.

Most worryingly, bearing in mind that China borders Russia for 2,264 miles with a blip for Mongolia in the middle, I read that Chinese Prime Minister Wen Jinbao announced that China is planning to invest US$12 billion in Russia by 2020. The Chinese premier said his country "is willing to increase investment in Russia on the construction of infrastructure facilities, exploitation of oil and gas and high technology co-operation." This might sound like a nice bit of co-operation, but really, Moscow signed this agreement with Beijing because it simply can’t afford either the money or the manpower to enforce that border. In the empty Russian east there are 16 million people and falling. In China, there are almost one-and-a-half billion and they need lebensraum. China is resource-poor; the Russian east contains 80% of that country’s resources. Russia is a dying country. With increasing global energy and resource problems, Chinese troops in Siberia seem a certainty within a few years. If you are worried about the US in Iraq, this will be a hundred times worse. Two ancient enemies, both nuclear powers fighting in a remote, resource rich, sparsely populated area? Nuclear escalation seems unavoidable.

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It wasn't that long ago they were running over students in tanks and last night there was an article on communist gangs forcibly injecting women in the stomach to abort second children.

I am anti-abortion - so do not condone what is described above.

If China did not have it's one child policy - in a couple of generations the world population could double or even triple. People in agrarian economies have always aimed for large families - so the young could look after the old - keep the farm going etc.

Ironically, we still need the young to look after the old - to pay our pensions. But the old have become so attached to high property prices that young people cannot afford to have families.

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It might happen. But it probably won't. Nobody's very good at projecting three decades hence. Really, we’re not very good at predicting half a decade out. There weren’t many experts in 1987 predicting that by 1992 the Berlin Wall, the Warsaw Pact and the Soviet Union would all have fallen.

There are plenty of reasons to assume that some disaster will stop China's rise to superpower status. We know that China has immense social problems. For example, since China introduced its “one child” policy in 1978, the imbalance between the sexes has increased to the point where there are 119 boys for every 100 girls. The pioneer generation of that 20% male surplus is reaching manhood now. What’s going to happen to those young men? As a general rule, large numbers of excitable lads who can’t get any action are useful only for cannon fodder. Add in the ever widening disparities between the glittering coastal cities and an impoverished rural backwater, well, that certainly sounds a likely candidate for some huge social upheaval. All we have now is a thin veneer of consumer goods masking the junta.

Most worryingly, bearing in mind that China borders Russia for 2,264 miles with a blip for Mongolia in the middle, I read that Chinese Prime Minister Wen Jinbao announced that China is planning to invest US$12 billion in Russia by 2020. The Chinese premier said his country "is willing to increase investment in Russia on the construction of infrastructure facilities, exploitation of oil and gas and high technology co-operation." This might sound like a nice bit of co-operation, but really, Moscow signed this agreement with Beijing because it simply can’t afford either the money or the manpower to enforce that border. In the empty Russian east there are 16 million people and falling. In China, there are almost one-and-a-half billion and they need lebensraum. China is resource-poor; the Russian east contains 80% of that country’s resources. Russia is a dying country. With increasing global energy and resource problems, Chinese troops in Siberia seem a certainty within a few years. If you are worried about the US in Iraq, this will be a hundred times worse. Two ancient enemies, both nuclear powers fighting in a remote, resource rich, sparsely populated area? Nuclear escalation seems unavoidable.

Thats a good post. The collapse of Russia, however, was predicted in the early 80's by NATO economists. Key information was leaked from there on how much of GDP was being spent on the impressive military and defense forces which is all we saw in the west - over 50% of all economic activity!

All the west then had to do to bring the end to the cold war, and bring them to the bargaining table was to force them to increase spending - Hence Reagan's insanely expensive starwars program.

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I am anti-abortion - so do not condone what is described above.

If China did not have it's one child policy - in a couple of generations the world population could double or even triple. People in agrarian economies have always aimed for large families - so the young could look after the old - keep the farm going etc.

Growing wealth is most closely connected with reducing the birth rate. Take China's neighbour, Japan, where it was common to have very large families in the post-war period. now the birthrate is down to about 1.2.

China's policy will probably mean a reduction of a few hundred million people or more in the population, which fortunately for us and them slows the reduction in fixed resources.

However, in the future China will have the problem of having a very distorted population distribution, with far more old (and non-productive) people than young people. Those of working age will have to work increasingly hard to support them. It will be an exaggerated version of the problem faced by the West. It will limit growth.

The growing imbalance of boys to girls, mentioned elsewhere, occurs with those in rural areas who are allowed to have a second baby. All the girls will go to the city when they are older to work or marry leaving unmarried men in the fields. The problem would then get worse.

China will need to ensure that the policy is removed before the imbalance grows too great.

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an interesting view that tallies somewhat with my own.

http://uk.biz.yahoo.com//24102005/323/chin...on-advisor.html

the rates of growth that we have seen in the Chinese economy of late are unusual, and history shows that any economy booming so much invariably falls into a period of retrenchment equally rapidly.

as they own so much of our debt, one would expect them to go down with us when the bust hits the west. The very nature of the globalised economy dictates that the coming "correction" is almost certain to be global, and more synchronised than previous ones. Look at how the US is catching up with us in the cycle.

So for those who are worried about the Chinese seizing their destiny as the sun sets on the west, I simply say this..."don't" (excuse the Bliarisms) ;)

Naturally the Chinese economy will suffer setbacks just as did the economy of the US when it joined the world economy and grew at breakneck speed during the nineteenth century but this absolutely does not mean that China won't continue to grow in relative terms. Terms like the Chinese 'seizing their ascendancy' or 'the sun sets on the west' are just silly. Apocalypt of the week.

Edited by BoredTrainBuilder

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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