Neither article nor the OP have credible conclusions to what is happening in China. China is in a debt spiral where possible options are becoming more and more expensive. The biggest property builder (Evergrande) has overstretched and there is a fear it is about to collapse. The people buy property in advance in China, before construction has started. The government will have to step in, but this is going to be expensive by anyone's standards. Think along the lines of the banking collapse of 2008 and then remember this is straight after Covid.
China's belt and road initiative is faring badly. They have loaned large sums to countries that were bad risks. With the world in the state it is currently, a lot of those debts will default. Russia is touted as being one of those, but I think they will give Russia a deal in exchange for cheaper oil. It is not like Russia has a lot of options there.
Manufacturing is on its knees, because of the deflation that is currently hitting the country - Archived link. They have made purchases for commodities to manufacture, and selling those at a profit is becoming difficult. Again government will have to step in here or loose some of the larger firms. Smaller firms will be allowed to go to the wall if they have no resources. China is a country where accountability is handed out at the behest of the party. I would not be surprised to see some managers imprisoned for being at the short end of this one.
The US's ban on tech trades is one that will bite. China will see their fortunes dwindle if they cannot keep pace with tech. This could lead to a backlash by invading Taiwan. This would not be good for any country as everyone buys from Taiwan. I think it is as much as 80% of all chips produced come from there. For high end tech that figure is as high as 95%. This would be catastrophic globally.
This would be a huge gamble for China to take on. If there is a protracted war similar to Ukraine, then this will cause global collapses, as people need tech for infrastructure. And even if China could make a snatch and grab on Taiwan, would the west continue to purchase tech from there in the future? I personally think that if China invaded then they would see themselves in a situation similar to Russia, although not with the pace that Russia suffered sanctions. This would be a slow march into a second cold war.
China has gained an arrogance in thinking that it is too big to fail. It is a form of Trumpism on a national scale. One where it thinks it can just ignore normal restraints due to the influence it has on the world. Russia has woken the west up to this reliance on rogue states. There will be a slow move away from relying on China as a manufacturing base for cheaper goods. The EU and the US have already stated this publicly. If China continues on the path it is choosing then the west will close ranks. This is not in the interests of anyone globally.
This is hardly likely. China has a huge amount of resources to draw. Any fall in China will be a slow grind to a halt. Manufacturing will be the first to slow down as they cannot produce goods without buying materials from abroad. So long as they can purchase those then China will continue.
No you see China has reached the end of the iron fusing stage and shortly the process of nuclear fusion will no longer produce enough pressure to balance the pull of gravity, causing China to collapse in to a black hole. When this happens Mongolian will be spaghettified in the Acretion disk, meaning that giant statue of Chingis Khan in Ulaan Bator will become Loooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooong.
China has gained an arrogance in thinking that it is too big to fail. It is a form of Trumpism on a national scale. One where it thinks it can just ignore normal restraints due to the influence it has on the world. Russia has woken the west up to this reliance on rogue states. There will be a slow move away from relying on China as a manufacturing base for cheaper goods. The EU and the US have already stated this publicly. If China continues on the path it is choosing then the west will close ranks. This is not in the interests of anyone globally.
Nobody is going to replace China as the manufacturing base. "B-b-b-but Vietnam" There's like two Chinese provinces with a larger population than Vietnam. Vietnam can't even replace two provinces individually, let along the entire country. "B-b-b-but India" India is the world's provider of IT services, not a manufacturing juggernaut by any means. This manufacturing base is not going to poof into existence. And as for the Russian invasion of Ukraine, all it showed is that the West is far more vulnerable and the "rogue states" (ie the rest of the world) don't need to concern themselves with the West for long. Why do you think so many Nigeriens are waving around Russian flags and why so many countries are tripping over themselves to join BRICS? Do you think it's a coincidence that the Nigerien coup was launched while France is still recovering from domestic riots?
India is also in the middle of a destabilizing Fascist takeover by a ethno-religious reactionary force that took evolution out of the text books. They're also going to continue to suffer horribly due to climate change. Bangladesh, right on the border, is one of the primary candidates for an apocalyptic wet bulb event that could potentially kill millions of people and drive millions of more to flee.
China was a backwards nation 20 years ago. Much like India, or most countries in Africa today. The EU are not talking about moving their purchases to other cheap countries; They want that manufacturing base in the EU. If they expand the block in the right countries, then this may be a reality China has to deal with. The aggressive policies China is adopting is what is causing this.
It was China's central planning and independent economic policy that caused it to develop. Those other countries are crippled by Western-imposed neoliberalism designed to keep them from developing.
Yeah, the idea that western neoliberal economies are capable of anything other than self-destructive auto-cannibalism is farcical. How is Blackrock supposed to jack up quarterly profits by building things?!! The UK is already speedrunning a return to a medieval economy. France is fighting for it's life to retain it's colonial possessions. Berlin answers to DC. And the rest of Europe doesn't matter.
I would be shocked if they invaded Taiwan and TSMC wasn't reduced to rubble first thing. Having a technological edge is just too valuable to the Western strategy. I also suspect that there would be a significant risk of escalation, because unlike Ukraine the US is already there and already talking about maybe-possibly getting involved if anything starts.
The Republic of China has something the US wants. Ukraine is just cannon fodder for DC's project to destabilize the RF. They don't give a shit what happens to Ukraine as long as it's expensive to Russia. They don't give a shit what happens to the Republic of China, either, and it's likely that as soon as the US has equivalent chip fabs (if the US is even capable of building something that complex, which is an open question) they'll either drop or significantly scale down their support for the Republic of China.
The US has made commitments to Taiwan and supplied arms. They are also looking to manufacture that tech in the states. I really don't see the Chinese going down that road, but they keep making threats, and while there is threats there is a chance they will be cornered into carrying them out. They certainly will not want to slide back into the economy of the 90's.
China built an economy on consumer electronics and smartphones. That industry is currently seeing a significant slowdown because of a mild recession in most of the world. Now, people are shocked that their economy is slowing down?
China built an economy on consumer electronics and smartphones.
Machinery and electronics only account for about 40% of China's exports and that includes industrial machinery and electronics as well. That's just exports too, so it doesn't include huge sectors like agriculture, infrastructure, housing, and local services.
It really hurts the credibility of the China doomers when you realize that their analysis is predominantly vibes-based.
"the last time I looked at China's economy was in 2005, but I reckon nothing much has changed there since then. hasn't changed much since then in the West, so..."
I don't think anyone has been surprised. The finances of the world have global impacts. China relies heavily on importing consumables to manufacture. This has indeed been part of the issue. This shows up in the PMI where China is sitting in the danger zone below 50.
Neither article nor the OP have credible conclusions to what is happening in China. China is in a debt spiral where possible options are becoming more and more expensive. The biggest property builder (Evergrande) has overstretched and there is a fear it is about to collapse. The people buy property in advance in China, before construction has started. The government will have to step in, but this is going to be expensive by anyone's standards. Think along the lines of the banking collapse of 2008 and then remember this is straight after Covid.
China's belt and road initiative is faring badly. They have loaned large sums to countries that were bad risks. With the world in the state it is currently, a lot of those debts will default. Russia is touted as being one of those, but I think they will give Russia a deal in exchange for cheaper oil. It is not like Russia has a lot of options there.
Manufacturing is on its knees, because of the deflation that is currently hitting the country - Archived link. They have made purchases for commodities to manufacture, and selling those at a profit is becoming difficult. Again government will have to step in here or loose some of the larger firms. Smaller firms will be allowed to go to the wall if they have no resources. China is a country where accountability is handed out at the behest of the party. I would not be surprised to see some managers imprisoned for being at the short end of this one.
The US's ban on tech trades is one that will bite. China will see their fortunes dwindle if they cannot keep pace with tech. This could lead to a backlash by invading Taiwan. This would not be good for any country as everyone buys from Taiwan. I think it is as much as 80% of all chips produced come from there. For high end tech that figure is as high as 95%. This would be catastrophic globally.
This would be a huge gamble for China to take on. If there is a protracted war similar to Ukraine, then this will cause global collapses, as people need tech for infrastructure. And even if China could make a snatch and grab on Taiwan, would the west continue to purchase tech from there in the future? I personally think that if China invaded then they would see themselves in a situation similar to Russia, although not with the pace that Russia suffered sanctions. This would be a slow march into a second cold war.
China has gained an arrogance in thinking that it is too big to fail. It is a form of Trumpism on a national scale. One where it thinks it can just ignore normal restraints due to the influence it has on the world. Russia has woken the west up to this reliance on rogue states. There will be a slow move away from relying on China as a manufacturing base for cheaper goods. The EU and the US have already stated this publicly. If China continues on the path it is choosing then the west will close ranks. This is not in the interests of anyone globally.
China will collapse any day now!
This is hardly likely. China has a huge amount of resources to draw. Any fall in China will be a slow grind to a halt. Manufacturing will be the first to slow down as they cannot produce goods without buying materials from abroad. So long as they can purchase those then China will continue.
No you see China has reached the end of the iron fusing stage and shortly the process of nuclear fusion will no longer produce enough pressure to balance the pull of gravity, causing China to collapse in to a black hole. When this happens Mongolian will be spaghettified in the Acretion disk, meaning that giant statue of Chingis Khan in Ulaan Bator will become Loooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooong.
lmfao sure lib
Any day now.
Two of those three articles are from fucking 2021. Let me know when Evergrande finally takes down the Chinese economy.
They were just first google links I found. Joe bloggs has plenty up to date information. Fill your boots.
this is where you're getting your information? lmao you're beyond help
2021 articles predicting Chinas imminent collapse that didn’t happen then either and a YouTube blogger
Solid.
Nobody is going to replace China as the manufacturing base. "B-b-b-but Vietnam" There's like two Chinese provinces with a larger population than Vietnam. Vietnam can't even replace two provinces individually, let along the entire country. "B-b-b-but India" India is the world's provider of IT services, not a manufacturing juggernaut by any means. This manufacturing base is not going to poof into existence. And as for the Russian invasion of Ukraine, all it showed is that the West is far more vulnerable and the "rogue states" (ie the rest of the world) don't need to concern themselves with the West for long. Why do you think so many Nigeriens are waving around Russian flags and why so many countries are tripping over themselves to join BRICS? Do you think it's a coincidence that the Nigerien coup was launched while France is still recovering from domestic riots?
India is also in the middle of a destabilizing Fascist takeover by a ethno-religious reactionary force that took evolution out of the text books. They're also going to continue to suffer horribly due to climate change. Bangladesh, right on the border, is one of the primary candidates for an apocalyptic wet bulb event that could potentially kill millions of people and drive millions of more to flee.
China was a backwards nation 20 years ago. Much like India, or most countries in Africa today. The EU are not talking about moving their purchases to other cheap countries; They want that manufacturing base in the EU. If they expand the block in the right countries, then this may be a reality China has to deal with. The aggressive policies China is adopting is what is causing this.
It was China's central planning and independent economic policy that caused it to develop. Those other countries are crippled by Western-imposed neoliberalism designed to keep them from developing.
Yeah, the idea that western neoliberal economies are capable of anything other than self-destructive auto-cannibalism is farcical. How is Blackrock supposed to jack up quarterly profits by building things?!! The UK is already speedrunning a return to a medieval economy. France is fighting for it's life to retain it's colonial possessions. Berlin answers to DC. And the rest of Europe doesn't matter.
Oh look racism.
maybe 40 years ago. but 20 years ago was 2003. China was not like India or Africa is now.
I would be shocked if they invaded Taiwan and TSMC wasn't reduced to rubble first thing. Having a technological edge is just too valuable to the Western strategy. I also suspect that there would be a significant risk of escalation, because unlike Ukraine the US is already there and already talking about maybe-possibly getting involved if anything starts.
Anyway, thanks for writing an update.
Yeah the US has been far far more outspoken about defending Taiwan than Ukraine.
The Republic of China has something the US wants. Ukraine is just cannon fodder for DC's project to destabilize the RF. They don't give a shit what happens to Ukraine as long as it's expensive to Russia. They don't give a shit what happens to the Republic of China, either, and it's likely that as soon as the US has equivalent chip fabs (if the US is even capable of building something that complex, which is an open question) they'll either drop or significantly scale down their support for the Republic of China.
The US has made commitments to Taiwan and supplied arms. They are also looking to manufacture that tech in the states. I really don't see the Chinese going down that road, but they keep making threats, and while there is threats there is a chance they will be cornered into carrying them out. They certainly will not want to slide back into the economy of the 90's.
China built an economy on consumer electronics and smartphones. That industry is currently seeing a significant slowdown because of a mild recession in most of the world. Now, people are shocked that their economy is slowing down?
Machinery and electronics only account for about 40% of China's exports and that includes industrial machinery and electronics as well. That's just exports too, so it doesn't include huge sectors like agriculture, infrastructure, housing, and local services.
It really hurts the credibility of the China doomers when you realize that their analysis is predominantly vibes-based.
"the last time I looked at China's economy was in 2005, but I reckon nothing much has changed there since then. hasn't changed much since then in the West, so..."
I don't think anyone has been surprised. The finances of the world have global impacts. China relies heavily on importing consumables to manufacture. This has indeed been part of the issue. This shows up in the PMI where China is sitting in the danger zone below 50.