China, the next big crisis and why the US is to blame - Page 2 - Politics | PoFo

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China announced a rate cut overnight although I doubt that this will do much for Chinese share prices since the prices are still so high. Cutting rates to save stock prices is kind of a dumb idea anyway. They seem to have also dropped the idea of the state buying shares (after dumping 400 billion dollars into that hole), but that was a far stupider idea than cutting rates which at least has a more useful effect on the real economy.

The Chinese don't seem to have any coherent plan for dealing with this - I wouldn't be surprised if they tried government share purchases again, though the effect would only be to shovel more money into the hole and bail out the idiots who bought into this bubble.

U.S. and european shares are up and the U.S. posted strong jobs, housing, and consumer confidence numbers, which is encouraging for the U.S. economy

US has deleveraged, at least in the private sector (where it really counts). This is healthy for the US, but not so much for the Chinese, as it impacts their export earnings. It doesn't seem to me the Chinese yet have a handle on how to transition into a domestic consumer economy.
That's one leveraged graph. Why not show 0-100 over a 20 year period.

I don't call local consumption growing and manufacturing slowing not having a handle on transitioning. That's exactly what's happening. Consumer index has been outpacing manufacturing for years now. Share market is what, 15% household share, vs >100% in the west? Different thing entirely, which is why shares tanking in China (i.e wiping out grandiose 3 month gain) is not indicative of anything resembling the same if it were to happen in the eurozone or US.

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