China - Economic Data & News 20 (Nov 22 - Aug 23)

[winston]

It’s becoming increasingly difficult to see China and the CCP becoming the world’s dominant superpower…

Here are just a few reasons why:

1) Food and Water

China has 22% of the world’s population, but just 9% of the world’s arable land and just 6% of the world’s fresh water. Both are shrinking rapidly.

China lost 6% of its arable land due to erosion and climate change from 2009-2019, and its water supply has been in astonishing decline.

By comparison, the US has 4% of the world’s population but 11% of the arable land. And with respect to water, Lake Superior alone constitutes 10% of the world’s fresh water supply. The Great Lakes combined are around 20%.


2) Energy

Ditto for proven energy reserves. North America’s energy reserves (coal, oil, natural gas, shale) blow China away, especially on a per-capita basis.


3) Debt

I’ve written extensively about America’s gargantuan debt problems. The US is obviously not alone; many European countries, for example, also have enormous debt challenges. And so does China.

China’s debt problems are a bit more hidden, more subtle. But to give you a sense of the problem, the total state and local government debt burden in the United States is around $3 trillion according to Federal Reserve data. In China, local government debt is north of $10 trillion.

And total debt in China (as estimated by groups like Goldman Sachs) is now similar to total US debt at around 280% of GDP.

The People’s Bank of China has had to slash interest rates, inject hundreds of billions in liquidity to prop up asset prices, and they’ve even cut commercial banks’ reserve ratios… which makes Chinese financial institutions MUCH riskier.


4) Economic momentum

China is rapidly losing is global manufacturing and export dominance. Some of this was a self-inflicted gunshot wound with the country’s insane zero COVID policy.


5) Demographics

Decades of China’s One Child Policy have left the country’s demographics totally upside down. There are too many old people, and not enough young people in the work force to support them.

Western nations have this problem too. But over the next decade, China’s demographic problem will become MUCH worse than the US or Europe. This is a social and economic disaster in the making.


6) Health

Much has been written about the pitiful state of US health. Obesity. Heart disease. Mental disorders. Drug abuse. Well, China has its own severe health issues, including an alarming rise in heart disease and hypertension prevalence. Plus the country is suffering an unbelievable diabetes epidemic.


7) Reputation

This is a really tough one. Very few countries (if any) trust China.

Think about it this way: the Federal Reserve Bank of New York presently holds several thousand tons of gold in its vaults on behalf of foreign governments and central banks.

Is there any country in the world that is willing to store their gold in China? No chance. No one trusts China’s Communist Party.

And fixing that reputation issue will take decades of good behavior and rehabilitation.

So in total, China has major, major problems.

I’ve written before that it’s easier to fix problems when your country is on the rise (versus being in decline). But that’s no guarantee that China can pull it off… and certainly no guarantee that China will become the world’s dominant superpower.

None of this takes away from America’s laundry list of problems. The national debt. The dollar. Social chaos. Pitiful leadership. The rise of socialism. Etc.

Like China, America’s problems are also fixable. For now. But let us not forget that the country is still led by a guy who shakes hands with thin air, plus a Congress full of morally bankrupt idiots and cowards.

And it’s for this reason that it makes so much sense to have a Plan B.

Source: Sovereign Man

[behappyalways]

3 big gray rhinos attack China? Goldman Sachs estimates that the explicit local debt is as high as 23 trillion US dollars, and the West underestimates the "bomb disposal capability" of China's central government
3大灰犀牛襲中國？高盛估顯性地方債高達23兆美元 西方低估中國中央"拆彈能力"｜20230610｜@inewsplus
https://m.youtube.com/watch?v=eaPNXzx7g5Y


China’s economy is way more screwed than anyone thought
https://www.businessinsider.com/china-d ... er=twitter

[winston]

Allianz Global Investors take an “old” and “new” approach in selecting China’s long term growth drivers.

They see opportunities in 5 themes:

1) Self-sufficiency
2) Infrastructure stimulus
3) Renewable energy
4) Healthy lifestyle
5) Financial market reform

https://www.allianzgi.com/en/home/insig ... nd-pretend

[winston]

China’s slowing economic recovery forces job cuts, investment delays as reopening boost wanes

Disappointing manufacturing activity, exports data and youth unemployment have added to China’s sluggish post-coronavirus economic recovery

Manufacturers are cutting jobs, reducing operating costs and shutting down production lines, while investment and consumption is also slowing

by Mandy Zuo, He Huifeng & Kandy Wong

Source: SCMP

https://www.scmp.com/economy/china-econ ... n_business

[behappyalways]

The mainland's economic recovery trend stalled in May and the authorities pushed for tax cuts, fee cuts and low profits to boost domestic demand

陸經濟復甦趨勢5月熄火 當局推減稅.降費.低利拉抬內需｜方念華｜FOCUS全球新聞 20230614@TVBSNEWS01

https://m.youtube.com/watch?v=esa4V3McxAU

[behappyalways]

Those who work 1 hour per week are not considered unemployed

Working 1 hour a week does not count as unemployment! Youth unemployment rate reached a new high in February
1周工作1小時不算失業! 陸青年失業率連2月新高｜方念華｜FOCUS全球新聞 20230616@tvbsfocus
https://m.youtube.com/watch?v=5MC_3yllXM8


Create your own income? An old Chinese farmer was fined 500,000 yuan for selling vegetables for 60 yuan! The Internet criticizes "bandits in the government" and uses fines to generate income. Local governments "cut leeks" frequently spread
自己收入自己創造？中國老農賣菜60元遭罰50萬！網怒批"土匪在機關" 以罰款創造收入 地方政府"割韭菜"頻傳｜記者 林羿含｜【國際局勢】20230616｜三立iNEWS
https://m.youtube.com/watch?v=wUgzbDgC7fo

[behappyalways]

China Withholds Cremation Data From Late 2022 After Ditching "Zero Covid" Policy
https://www.zerohedge.com/political/chi ... covid-wave

[behappyalways]

Mainland 618 e-commerce mid-year promotions rely on digital live broadcast to attract customers
大陸618電商年中慶促銷 靠數位人直播吸客｜秦綾謙｜FOCUS全球新聞 20230619@tvbsfocus
https://m.youtube.com/watch?v=MfYZu_3HhTs


Working 1 hour a week is not considered unemployment! The Statistics Bureau of Mainland China angered netizens
1周工作1小時就不算失業! 中國大陸統計局惹怒網民｜TVBS新聞
https://m.youtube.com/watch?v=ZPYIqk6xk-k


Unemployed upon graduation? "Zombie photos" are prevalent among Chinese graduates, and the youth unemployment rate hits a record high. 6 million young people are looking for a way out.
畢業即失業？中國畢業生盛行"喪屍照" 青年失業率創新高 600萬年輕人找嘸頭路 中國民眾：超多人想"潤"出國｜記者 姚懷真｜【國際局勢】20230619｜三立iNEWS
https://m.youtube.com/watch?v=SWjnM8akqdw


E-commerce firms avoided discussing gross merchandise value numbers, once a key indicator of success, after China’s second-largest shopping festival concluded

China’s 618 shopping festival loses its shine, as Alibaba and JD.com avoid sales figures for more flattering data

https://www.scmp.com/tech/big-tech/arti ... flattering

[winston]

China Update

by Yeo Boon Ping

Back in January, when China abruptly abandoned its “zero-Covid” policy, analysts were by equal measures worried and excited.

Worried, because a massive economic engine suddenly roaring back to life could stoke the flames of inflation even higher. Analysts braced for higher commodities and oil prices.

On the other hand, many saw China as a potential driver of a global economy that had lost its way. To quote Standard Chartered Chairman José Viñals: “The Chinese economy is going to be on fire and that’s going to be very, very important for the rest of the world.”

At approximately the halfway mark of the year, here’s how China’s stacking up against those expectations. In short: It seems everyone’s wrong about China.

Instead of turning up the heat of inflation, China’s combating a potential deflationary problem domestically. The country’s consumer price index rose only 0.2% year over year, while its producer price index plummeted 4.6%.

Recent economic data’s been so disappointing that Wall Street banks have started to cut their expectations of China’s economic growth this year — though their projections are, optimistically, still higher than the country’s own target of “around 5%.”

Meanwhile, oil prices have been sliding despite Saudi Arabia announcing surprise cuts to production, and iron ore prices aren’t doing so hot either because China’s demand for steel is projected to fall.

China’s economy, to put it plainly, isn’t doing so well. It’s true things might turn around: The country’s central bank has started cutting rates, and analysts think fiscal stimulus is on its way.

But for now, the Chinese dragon’s still dozy — and things are starting to feel a little too chilly.

Source: CNBC

[winston]

Interest rates cut

The People's Bank of China cut the one-year and five-year loan prime rates by 10 basis points in its first reductions in 10 months in a bid to shore up a slowing economy.

Some economists had predicted a 15 bps cut in the five-year rate to support the property market.

The decision knocked the yuan lower, with the offshore yuan falling 0.2 percent to trade at 7.1827 per US dollar.

The official Securities Daily said China's gross domestic product growth may reach 7 percent in the second quarter and 6 percent in the first half, while HSBC Assets Management cut its full-year growth forecast to 5.3 percent from 6.3 percent.

Source: The Standard

https://www.thestandard.com.hk/section- ... cuts-rates