How do the Chinese see themselves? - Page 7 - Politics Forum.org | PoFo

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Political issues in the People's Republic of China.

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#15194139
@JohnRawls, assuming that China stops growing anytime soon, why would that effect them more than the West who have barely made single digit growth figures for the last 13 years now? Why do you think China need to keep growing at 8% year on year out given that is what they can expect this year. They also had positive growth when the world was negative last year, another impressive achievement don't you think.

Also Evergrande debt is multinational. And China have enough reserves to bail it out. They however don't seem interested in doing that. Seems a strange stance to make given you are saying it could destroy their economy. Or maybe it won't and they know that and instead fuck up the global financial institution, especially the creditors of Evergrande instead and they aren't too concerned on that. Besides, Evergrande collapse may well stabilise the Chinese Market and prevent the need for the Chinese government to artifical hike the market to protect investors. Let them fall on their own sword and build up from a blank canvas. Xi seems to stand on the Socialism platform recently and ending all these leaseholds might be start of all that.
#15194140
B0ycey wrote:@JohnRawls, assuming that China stops growing anytime soon, why would that effect them more than the West who have barely made single digit growth figures for the last 13 years now? Why do you think China need to keep growing at 8% year on year out given that is what they can expect this year. They also had positive growth when the world was negative last year, another impressive achievement don't you think.

Also Evergrande debt is multinational. And China have enough reserves to bail it out. They however don't seem interested in doing that. Seems a strange stance to make given you are saying it could destroy their economy. Or maybe it won't and they know that and instead fuck up the global financial institution, especially the creditors of Evergrande instead and they aren't too concerned on that. Besides, Evergrande collapse may well stabilise the Chinese Market and prevent the need for the Chinese government to artifical hike the market to protect investors. Let them fall on their own sword and build up from a blank canvas. Xi seems to stand on the Socialism platform recently and ending all these leaseholds might be start of all that.


The simple answer here is that CCP legitimacy is based on economic growth. This is the basic trade for Authoritarian societies that you trade in your liberties and so on for growth and stability. Legitimacy in the West is based on elections so we don't have that problem. Considering that the West has the highest standards of living also then the slow growth along with the legitimacy question is not a problem. When you have low standards of living/nominal gdp per capita along with low growth then this causes instability.

As for the Evegrande situation and the whole sector issues. There are plenty of analysis about this but the general idea is that they can't bail it out. The scale is too large. The GDP to Property market value of China is 1 to 5.5 so the value of the whole property market and so on in China is 5.5 larger than the whole GDP of China. It is basically 65% of Chinese total wealth and 30% of their annual GDP.

Just to clarify the scale, while I don't agree with the panic this guy is spreading but the scope analysis is spot on mainly because most of the info is from Goldman Sachs analysis:

#15194143
JohnRawls wrote:general idea is that they can't bail it out


Didn't the CCP just partially bail them out last week?

I wonder if there will be occupy Beijing "wallstreet" protests. :eek:
#15194145
JohnRawls wrote:The simple answer here is that CCP legitimacy is based on economic growth. This is the basic trade for Authoritarian societies that you trade in your liberties and so on for growth and stability. Legitimacy in the West is based on elections so we don't have that problem. Considering that the West has the highest standards of living also then the slow growth along with the legitimacy question is not a problem. When you have low standards of living/nominal gdp per capita along with low growth then this causes instability.


China isn't some backwards shitpit John. It can rival the West for standards of living. Maybe the rural areas are still rural. Their cities are very modern.

Nonetheless I am trying to work this out. Are you saying that the people will revolt against the CCP if growth isn't maintained? You need to get out more if you do. The Chinese people are very patriotic and support the system they are in. Perhaps it is a hivemind. I don't know. What I do know is in that in China it is about working for the society on the whole and in the West it is about self interest. Considering that, I don't think the Chinese people would mind decades of recession as long as the state protects the interests of the state.

As for the Evegrande situation and the whole sector issues. There are plenty of analysis about this but the general idea is that they can't bail it out. The scale is too large. The GDP to Property market value of China is 1 to 5.5 so the value of the whole property market and so on in China is 5.5 larger than the whole GDP of China. It is basically 65% of Chinese total wealth and 30% of their annual GDP.

Just to clarify the scale, while I don't agree with the panic this guy is spreading but the scope analysis is spot on mainly because most of the info is from Goldman Sachs analysis:


It maybe worse than Goldman Sachs. It maybe worse than 2008. And sure, this is a fucking big bubble. But who is going to lose here? The CCP or the people who have invested and gave loans to Evergrande? Their debt is $350mn btw, so significantly less than the $2.2tn America paid for everyone to sit on their ass I might add. So China could bail them out. But I think they want them to fail, and even for their housing market to fail given the only losers are the investors as far as I can see. They could also buyout Evergrande and gain their entire portfolio for nothing. But given China have no interest in bailing out Evergrande whilst the Western world seem concerned, you have to ask why that is if, as you claim, this could destroy the Chinese economy. Perhaps because it won't. Maybe it will crash their housing bubble and that will hurt alot of Chinese investors along with the global financial market and at which point the Chinese government will have to intervene I guess. But their economy will be fine either way.
#15194146
Rancid wrote:Didn't the CCP just partially bail them out last week?

I wonder if there will be occupy Beijing "wallstreet" protests. :eek:


They can't bail out all of the sector, as much as I know they have been pumping hundreds of billions in last 2 months but that is nothing. The problem is not just Evegrande but the whole sector in general. This all started in June when they introduced the three red lines and limited debt growth to 15% maximum and downwards depending on those red lines. If that is removed then the situation will get better but the problem then is not fixed. It is like digging yourself in a deeper hole if they remove them.

If you watch the video then you see that their housing as an equity is 62 trillion which is insane considering that they are like 6-7 times poorer on nominal gdp per capita basis. I mean there is a certain logic here that there is more people in China but this still doesn't make much sense. The difference in population is 4 times. So quick napkin math here that is not accurate but gets the general point accross is:
1) 6 divided by 4 is 1.5 multiplier = gdp per capita difference divided by population difference.
2) 62/34 = 1.83. Chinese property equity divided by US property equity class values.
3) So 1.83*1.5 = 2.745 is how much more Chinese corporations and people on average need to be more indebted compared to US to actually achieve this valuation considering US as reference point and conditions.

While this is very inaccurate evaluation and simplifies a very complicated field, it still demonstrates the problems. Reality is that US is very stable in this sense and the interests are very low due to a very developed financial and banking systems. For China this is highly likely not the case. So you need to consider interest payments also as a multiplier and get some kind of additional multiplayer between average Chinese interest rates and US interest rates which again will be in US favour. A European or American taking a bank loan for a house pays like 2.5% or below for house loans while this is not the case in most of the world.
#15194148
B0ycey wrote:China isn't some backwards shitpit John. It can rival the West for standards of living. Maybe the rural areas are still rural. Their cities are very modern.

Nonetheless I am trying to work this out. Are you saying that the people will revolt against the CCP if growth isn't maintained? You need to get out more if you do. The Chinese people are very patriotic and support the system they are in. Perhaps it is a hivemind. I don't know. What I do know is in that in China it is about working for the society on the whole and in the West it is about self interest. Considering that, I don't think the Chinese people would mind decades of recession as long as the state protects the interests of the state.



It maybe worse than Goldman Sachs. It maybe worse than 2008. And sure, this is a fucking big bubble. But who is going to lose here? The CCP or the people who have invested and gave loans to Evergrande? Their debt is $350mn btw, so significantly less than the $2.2tn America paid for everyone to sit on their ass I might add. So China could bail them out. But I think they want them to fail, and even for their housing market to fail given the only losers are the investors as far as I can see. They could also buyout Evergrande and gain their entire portfolio for nothing. But given China have no interest in bailing out Evergrande whilst the Western world seem concerned, you have to ask why that is if, as you claim, this could destroy the Chinese economy. Perhaps because it won't. Maybe it will crash their housing bubble and that will hurt alot of Chinese investors along with the global financial market and at which point the Chinese government will have to intervene I guess. But their economy will be fine either way.


Russia also has very developed Moscow and Saint Petersburg, it doesn't change the average statistics for the whole country. You can't consider just the most developed areas. Russia is also very patriotic with all of the propaganda and so on but Putin needed to falsify almost half of his own vote in the previous election while banning all independent media and trying to kill the main opposition leader and then putting him in jail for god knows how long. This all started from 2008 and picked up in 2011/2012 after the economic growth slowed down significantly. I would say that there are no exceptions to conditions of a society and China is not an exception to this.

The problem is not just Evegrande but the general property sector in China as the video mentions. I understand that it is 12 minutes and nobody would want to watch it. There is no simple way to describe the scale i guess. 62 Trillion is on the line here basically. One sentence doesn't do it justice though.
#15194149
JohnRawls wrote:Russia also has very developed Moscow and Saint Petersburg, it doesn't change the average statistics for the whole country. You can't consider just the most developed areas. Russia is also very patriotic with all of the propaganda and so on but Putin needed to falsify almost half of his own vote in the previous election while banning all independent media and trying to kill the main opposition leader and then putting him in jail for god knows how long. This all started from 2008 and picked up in 2011/2012 after the economic growth slowed down significantly. I would say that there are no exceptions to conditions of a society and China is not an exception to this.

The problem is not just Evegrande but the general property sector in China as the video mentions. I understand that it is 12 minutes and nobody would want to watch it. There is no simple way to describe the scale i guess. 62 Trillion is on the line here basically. One sentence doesn't do it justice though.


China lease out their land. Perhaps it was only a matter of time before investors got stung. Either way, it isn't $62tn on the line given the investment is property. The only catch is by selling it on you lose your investment. But perhaps the housing market should fail. Either way China isn't prepared to bail it out yet, are holding their cards close to their chest and seem less concerned than the West on the future of Evergrande given the only losers here are going to be investors.

As for Russia, well I don't see then falling either. And Navalny has been sentenced for 2 years, and even if he could have contested the election, would have lost anyway... even if it was completely fair. Navalny doesn't have the movement the West was hoping for when they sent him back. The protests lasted two weeks and were small in numbers
#15194150
B0ycey wrote:China lease out their land. Perhaps it was only a matter of time before investors got stung. Either way, it isn't $62tn on the line given the investment is property. The only catch is by selling it on you lose your investment. But perhaps the housing market should fail. Either way China isn't prepared to bail it out yet, are holding their cards close to their chest and seem less concerned than the West on the future of Evergrande given the only losers here are going to be investors.

As for Russia, well I don't see then falling either. And Navalny has been sentenced for 2 years, and even if he could have contested the election, would have lost anyway... even if it was completely fair. Navalny doesn't have the movement the West was hoping for when they sent him back. The protests lasted two weeks and were small in numbers


Navalnies support is actually huge. Both government and non-Russia organisation estimate that if he was allowed to run as a party which has been denied registry for 7 years or so now then he would get roughly the same as Putins united Russia or a bit lower. De facto his support is 2nd only to Putins party meaning that he would get around 20-25% while United Russia 25-30% with everyone else getting the rest. So Parties would need to create real coalitions between each other. Navalny had offices in every large city and almost all medium ones, well until his organisations were labelled as terrorists and were forced to disband around 6 months before the recent election a month ago.
#15194151
JohnRawls wrote:Navalnies support is actually huge. Both government and non-Russia organisation estimate that if he was allowed to run as a party which has been denied registry for 7 years or so now then he would get roughly the same as Putins united Russia or a bit lower. De facto his support is 2nd only to Putins party meaning that he would get around 20-25% while United Russia 25-30% with everyone else getting the rest. So Parties would need to create real coalitions between each other. Navalny had offices in every large city and almost all medium ones, well until his organisations were labelled as terrorists and were forced to disband around 6 months before the recent election a month ago.


It is difficult to know what support Navalny has given there isn't going to be any reliable data on it. What I do know is the protests for his release didn't generate much support. And he doesn't generate much column inches within the press at the moment neither. He was perhaps the Wests last hope but ultimately when they sent him back Pitin put him in jail and ended this farce once and for all.
#15194153
B0ycey wrote:It is difficult to know what support Navalny has given there isn't going to be any reliable data on it. What I do know is the protests for his release didn't generate much support. And he doesn't generate much column inches within the press at the moment neither. He was perhaps the Wests last hope but ultimately when they sent him back Pitin put him in jail and ended this farce once and for all.


People are afraid since Putin is jailing people straight away right now even for the slightest hint of protest. The protests that did happen were basically forcefully dispersed especially in Saint Petersburg. Plus there is nobody to organise the protest since all of the opposition leaders are in jail. At some point 9-6 months ago when the organisations were labelled as terrorists they really had no choice besides fleeing or going to jail.
#15194155
JohnRawls wrote:People are afraid since Putin is jailing people straight away right now even for the slightest hint of protest. The protests that did happen were basically forcefully dispersed especially in Saint Petersburg. Plus there is nobody to organise the protest since all of the opposition leaders are in jail. At some point 9-6 months ago when the organisations were labelled as terrorists they really had no choice besides fleeing or going to jail.


If Nalvany had the pull, that wouldn't matter. But it was interesting watching supporters march down the street as people walked past them in any case.

But even so, revolution has never been deemed as legal, so what are you saying here? That Russians are afraid of jail and so not protesting? If that is so, why do you think Russia is falling. And more importantly than that, why use Russia as an example for China falling?
#15194159
Potemkin wrote:
It's just things returning to the status quo ante - until about 1500 AD, the centre of gravity of the world's economy was firmly in Central Asia - China, India and the Islamic Caliphate (and its successor state, the Ottoman Empire) have always traditionally dominated the world economy. The rise of the West was an anomaly.


Given China's population, given its resource base, and given its high level of human capital, it is inevitable that it will eventually become the dominant economic power in the world. How could it not?



That reminds of of a cartoon from my childhood, Fractured Fables. A kid and his dad had a time machine, and they'd go back in time and screw things up.

Anyway... no.

We are in an era of transition, and anyone that thinks they can predict the future ought to give me some of what they're smoking. China has some real problems, water is one of them, and climate change will likely make that worse. It'd be one thing if they were working the problem, but they need to do way more than what they've been doing.


People used to say that about Japan. I used to think they were right. As it turns out, nope, we were full of it. China needs to transition into a mature economy, and indications are they are going to have an especially tough time doing that.
#15194165
Fasces wrote:Buy my goods... or else!


The importance of opium as an import good from the West (or rather the periphery occupied by the West because opium was imported from India) declined during the late 19th century and was replaced with cotton goods and later producer and consumer goods from the core.

B0ycey wrote:What I do know is in that in China it is about working for the society on the whole and in the West it is about self interest.


How anyone can write shit like this with a straight face is a mystery to me. :lol:
#15194169
Rugoz wrote:How anyone can write shit like this with a straight face is a mystery to me. :lol:


Easy. A free market relies on self interest (invisible hand) and the Chinese economy is based on what benefits the nation. If the 2008 crash occurred in China, the bankers would have been sent to jail. The US bailed them out. What does that say?

I guess when it comes to these things, I am more educated than you. :lol:
#15194175
B0ycey wrote:Easy. A free market relies on self interest (invisible hand) and the Chinese economy is based on what benefits the nation. If the 2008 crash occurred in China, the bankers would have been sent to jail. The US bailed them out. What does that say?

I guess when it comes to these things, I am more educated than you. :lol:


Well, let's see if that happens with Evergrande.

I mean, to me it seems the issue of housing bubbles and systemic risk is also a thing there.
#15194176
wat0n wrote:Well, let's see if that happens with Evergrande.

I mean, to me it seems the issue of housing bubbles and systemic risk is also a thing there.


I am pretty sure everyone involved in Evergrande are shitting themselves. There is no way I can be certain of what I write, but if Evergrande get bailed out and no one goes to jail, I will be gobsmacked.
#15194177
B0ycey wrote:I am pretty sure everyone involved in Evergrande are shitting themselves. There is no way I can be certain of what I write, but if Evergrande get bailed out and no one goes to jail, I will be gobsmacked.


But even in that case, where I would not rule out that some people won't go to jail but to the coffin instead, the actual problem would still remain... Right?
#15194178
wat0n wrote:But even in that case, where I would not rule out that some people won't go to jail but to the coffin instead, the actual problem would still remain... Right?


Which problem? The problem of Evergrande not able to pay off their interest payments or the housing bubble?
#15194180
B0ycey wrote:Easy. A free market relies on self interest (invisible hand) and the Chinese economy is based on what benefits the nation.


Wtf are you even talking about? What is this gibberish?

B0ycey wrote:If the 2008 crash occurred in China, the bankers would have been sent to jail. The US bailed them out. What does that say?


No banker that didn't violate the law should be jailed.

China will publicly execute/jail a few scapegoats who happen to be disloyal to the regime.

B0ycey wrote:I guess when it comes to these things, I am more educated than you. :lol:


Sure you are. :knife:
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