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China’s economy is in trouble

watsup

watsup

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Huge military build-up by China, but their economy is showing signs of trouble.

“China’s economy is faltering. Fifty years ago, China’s economy was, as Jim put it, “an economic afterthought.” Now, it’s the world’s largest or second-largest economy depending on the measure you prefer. But its breathtaking growth has finally come back down to earth. China is now experiencing an economic slowdown and its problems are multiplying. Zoe said it’s “too early to say” whether China is facing a short-term lull or long-term stagnation. Whichever is the case, as Jim pointed out, the Chinese economy has “fallen farther and faster than Chinese planners...and many Western experts predicted.”

China’s economic challenges go well beyond a slowing overall growth rate. Youth unemployment is at an all-time high, so much so that Chinese President Xi Jinping is telling Chinese youth that they should learn “to eat bitterness.” The real estate sector is drowning in debt. Deflation looks to be taking hold. Perhaps most troubling, China’s demographics are alarming. Its birthrate has plummeted, and the population is aging rapidly. An older population doesn’t inherently mean that a country will enter a downward economic spiral. However, China’s pensions system is “buckling under an aging population,” creating yet another challenge for Beijing to address.

A major Chinese real estate developer missed bond payments. The Chinese government has stopped reporting its youth unemployment rate after it hit a high of 21.3 percent in June. Stocks around the world are also feeling economic pressure. Hong Kong’s Hang Seng Index fell more than 20 percent last Friday. “

www.cfr.org

The President’s Inbox Recap: China’s Economic Downturn

Chinese economic growth has slowed dramatically as the country’s economic woes multiply.
www.cfr.org www.cfr.org
 
Great news for the west.
The more info that comes in on this the more and more favorable it looks for the west.
China will need us and be less likely to aid Russia and face sanctions.
 
China may well be in trouble. Decades of fast growth have been fuelled by massive overseas investments creating jobs and wealth in China to access the cheap labor, cheap supply chains, and also the Chinese market itself. When that wasn't enough, the Chinese govt propped the economy up with debt spending. Today though China has shown itself to be a less reliable 'political' partner than most wealthy nations are comfortable with, and the flow of investments has eased, while some companies are even removing their operations from China to more trustworthy partner countries. The heart of Chinas prosperity growth has been foreign investment and the attached knowledge transfer that has created China as a modern manufacturing giant. China needed to get their own middle class consumerism to a certain stage that would support the economy before endangering their relationships with the wealthy nations they have been relying on. They also needed to get their own technology developments to a stage where they no longer needed foreign input. They might be close on the tech development, but probably not on their internal economy which relies so heavily of debt and continuous growth to support that debt. It may well be that China, like Russia, has misread the Wests combined determination to not let authoritarian nations take control of the world. The Chinese leadership might well have tried to move too far, too fast and are now facing the impact of western nations, especially the US saying that they will no longer support a China that has what they consider to be evil intentions.
 
It's not all good news for the West, regardless of how we feel about China. We do live in a global economy.

A slowing, weaker Chinese economy affects the rest of the world, including the United States, through multiple important channels. Number one will be trade. As China economy slows down, naturally, this means Chinese demand for goods from other countries will also decline. Less Chinese imports means less income for other countries. For example, in the case of the United States, currently the United States exports close to $150 billion worth of goods to China.

And the number two channel of how China’s slowdown will spill over to the rest of world is the exchange rate. With China’s growth slow down, the Chinese RMB will depreciate. A depreciation of RMB means appreciation of other currencies, for example, the U.S. dollar. If U.S. dollars become more expensive relative to RMB, this means that U.S. goods are becoming less competitive. And this also means U.S. goods may lose some of its market share due to competition from cheaper Chinese goods.

The number three channel is financial indicators. Basically, concern about a Chinese slowdown and uncertainty about the potential implications may trigger so-called “risk-off” selling in the financial market. For example, during the last time China’s growth slowed down significantly, which was 2015 to 2016, the U.S. stock market has also declined because of concerns about China’s hard landing.

www.ncuscr.org

How China's Slowing Economy Affects the United States | U.S.-China Insights - NCUSCR

Houze Song explains how slowing economic growth, an aging society, and a looming property crisis have implications not just for China, but for the United States and beyond.
www.ncuscr.org www.ncuscr.org
 
watsup said:
Huge military build-up by China, but their economy is showing signs of trouble.

“China’s economy is faltering. Fifty years ago, China’s economy was, as Jim put it, “an economic afterthought.” Now, it’s the world’s largest or second-largest economy depending on the measure you prefer. But its breathtaking growth has finally come back down to earth. China is now experiencing an economic slowdown and its problems are multiplying. Zoe said it’s “too early to say” whether China is facing a short-term lull or long-term stagnation. Whichever is the case, as Jim pointed out, the Chinese economy has “fallen farther and faster than Chinese planners...and many Western experts predicted.”

China’s economic challenges go well beyond a slowing overall growth rate. Youth unemployment is at an all-time high, so much so that Chinese President Xi Jinping is telling Chinese youth that they should learn “to eat bitterness.” The real estate sector is drowning in debt. Deflation looks to be taking hold. Perhaps most troubling, China’s demographics are alarming. Its birthrate has plummeted, and the population is aging rapidly. An older population doesn’t inherently mean that a country will enter a downward economic spiral. However, China’s pensions system is “buckling under an aging population,” creating yet another challenge for Beijing to address.

A major Chinese real estate developer missed bond payments. The Chinese government has stopped reporting its youth unemployment rate after it hit a high of 21.3 percent in June. Stocks around the world are also feeling economic pressure. Hong Kong’s Hang Seng Index fell more than 20 percent last Friday. “

www.cfr.org

The President’s Inbox Recap: China’s Economic Downturn

Chinese economic growth has slowed dramatically as the country’s economic woes multiply.
www.cfr.org www.cfr.org
Click to expand...
America needs to cut the cord from China for so many of the products we are purchasing. In particular materials needed for battery, wind/solar production and for large amounts of our meds and computer chips.
 
Dictators don't give up power. If things get so bad the people rise, they will be brutally crushed as they were in 1989. Or, Xi might put the country under martial law and attack Taiwan.

Instability in dictatorships is a dangerous thing.
 
Integrityrespec said:
America needs to cut the cord from China for so many of the products we are purchasing. In particular materials needed for battery, wind/solar production and for large amounts of our meds and computer chips.
Click to expand...
100% agree - we've bowed too long to the god of "cheap" and now we're seeing what the true cost of what "cheap" really is, and worse, really could end up being.
 
dseag2 said:
It's not all good news for the West, regardless of how we feel about China. We do live in a global economy.

A slowing, weaker Chinese economy affects the rest of the world, including the United States, through multiple important channels. Number one will be trade. As China economy slows down, naturally, this means Chinese demand for goods from other countries will also decline. Less Chinese imports means less income for other countries. For example, in the case of the United States, currently the United States exports close to $150 billion worth of goods to China.

And the number two channel of how China’s slowdown will spill over to the rest of world is the exchange rate. With China’s growth slow down, the Chinese RMB will depreciate. A depreciation of RMB means appreciation of other currencies, for example, the U.S. dollar. If U.S. dollars become more expensive relative to RMB, this means that U.S. goods are becoming less competitive. And this also means U.S. goods may lose some of its market share due to competition from cheaper Chinese goods.

The number three channel is financial indicators. Basically, concern about a Chinese slowdown and uncertainty about the potential implications may trigger so-called “risk-off” selling in the financial market. For example, during the last time China’s growth slowed down significantly, which was 2015 to 2016, the U.S. stock market has also declined because of concerns about China’s hard landing.

www.ncuscr.org

How China's Slowing Economy Affects the United States | U.S.-China Insights - NCUSCR

Houze Song explains how slowing economic growth, an aging society, and a looming property crisis have implications not just for China, but for the United States and beyond.
www.ncuscr.org www.ncuscr.org
Click to expand...
Good post. Extremely important points that are all too often overlooked. Even with the worst perspectives presented, most forecasts project China still rising to a position as the number one economy by 2050, with India coming in second, and not surprisingly, Indonesia moving to the number four spot. The United States will drop to third. Though this prospect frightens some, these developments will prove to be an exciting time in the world in regards to growing ethical investment, environmental sustainability and global peace.
https://www.pwc.com/gx/en/research-insights/economy/the-world-in-2050.html
 
SayMyName said:
Good post. Extremely important points that are all too often overlooked. Even with the worst perspectives presented, most forecasts project China still rising to a position as the number one economy by 2050, with India coming in second, and not surprisingly, Indonesia moving to the number four spot. The United States will drop to third. Though this prospect frightens some, these developments will prove to be an exciting time in the world in regards to growing ethical investment, environmental sustainability and global peace.
https://www.pwc.com/gx/en/research-insights/economy/the-world-in-2050.html
Click to expand...
Alas it's the eternal Chinese Long Game.

We're failing now and we have so little going now but you all out there just wait until 25 years from now cause it's by then that we're gonna getcha.

Just not now.
 
dseag2 said:
It's not all good news for the West, regardless of how we feel about China. We do live in a global economy.

A slowing, weaker Chinese economy affects the rest of the world, including the United States, through multiple important channels. Number one will be trade. As China economy slows down, naturally, this means Chinese demand for goods from other countries will also decline. Less Chinese imports means less income for other countries. For example, in the case of the United States, currently the United States exports close to $150 billion worth of goods to China.

And the number two channel of how China’s slowdown will spill over to the rest of world is the exchange rate. With China’s growth slow down, the Chinese RMB will depreciate. A depreciation of RMB means appreciation of other currencies, for example, the U.S. dollar. If U.S. dollars become more expensive relative to RMB, this means that U.S. goods are becoming less competitive. And this also means U.S. goods may lose some of its market share due to competition from cheaper Chinese goods.

The number three channel is financial indicators. Basically, concern about a Chinese slowdown and uncertainty about the potential implications may trigger so-called “risk-off” selling in the financial market. For example, during the last time China’s growth slowed down significantly, which was 2015 to 2016, the U.S. stock market has also declined because of concerns about China’s hard landing.

www.ncuscr.org

How China's Slowing Economy Affects the United States | U.S.-China Insights - NCUSCR

Houze Song explains how slowing economic growth, an aging society, and a looming property crisis have implications not just for China, but for the United States and beyond.
www.ncuscr.org www.ncuscr.org
Click to expand...
It's The Long Train of Possible Horrors for sure.

The global economy knows CCP has not had its "major economic correction" yet while knowing with certainty it's begun. The huge property bubble has burst for instance and other bubbles are cascading the economy toward its inevitable collapse.

CCP was never going to have its Lehman Brothers moment because the CCP economy is a different beast from Western capitalism and liberal democracy. In China it's a slow agonizing across the board slippage and decline.

But the "correction" has begun. The global economy began adjusting to it and continues to adjust to it. The BoyZ in Beijing will need a bailout by the IMF and World Bank and by major banks in the economies of major countries. This is when China will be changed from and by the outside.
 


 
watsup said:
Huge military build-up by China, but their economy is showing signs of trouble.

“China’s economy is faltering. Fifty years ago, China’s economy was, as Jim put it, “an economic afterthought.” Now, it’s the world’s largest or second-largest economy depending on the measure you prefer. But its breathtaking growth has finally come back down to earth. China is now experiencing an economic slowdown and its problems are multiplying. Zoe said it’s “too early to say” whether China is facing a short-term lull or long-term stagnation. Whichever is the case, as Jim pointed out, the Chinese economy has “fallen farther and faster than Chinese planners...and many Western experts predicted.”

China’s economic challenges go well beyond a slowing overall growth rate. Youth unemployment is at an all-time high, so much so that Chinese President Xi Jinping is telling Chinese youth that they should learn “to eat bitterness.” The real estate sector is drowning in debt. Deflation looks to be taking hold. Perhaps most troubling, China’s demographics are alarming. Its birthrate has plummeted, and the population is aging rapidly. An older population doesn’t inherently mean that a country will enter a downward economic spiral. However, China’s pensions system is “buckling under an aging population,” creating yet another challenge for Beijing to address.

A major Chinese real estate developer missed bond payments. The Chinese government has stopped reporting its youth unemployment rate after it hit a high of 21.3 percent in June. Stocks around the world are also feeling economic pressure. Hong Kong’s Hang Seng Index fell more than 20 percent last Friday. “

www.cfr.org

The President’s Inbox Recap: China’s Economic Downturn

Chinese economic growth has slowed dramatically as the country’s economic woes multiply.
www.cfr.org www.cfr.org
Click to expand...

It has always been a huge bubble.
Just as you can't rely on an apocalyptic religion to solve spiritual or social problems because they are focused on The End of the World, likewise you can't trust a Communist market economy to promote economic health and stability because they are focused on The End of Capitalism.
 
ralfy said:
www.foreignaffairs.com

China Is Still Rising

Don’t underestimate the world’s second-biggest economy.
www.foreignaffairs.com www.foreignaffairs.com
Click to expand...
Just barely.

It's only the inertia of the past 20 years that keeps the CCP heads above water.

That is winding down now under Xi the absolute Maoist who insists and demands that the Party controls and directs everything. Your communism has never had the right idea or paradigm of how to organize a society and economy.

Your paradigm is a total fail. Communism always devours itself. This is what is occurring under Xi Jinping and his dominant faction within the CCP. China is stagnant. Its rise is done and gone. The Chinese economy is big but it is stagnant as GDP under Xi has gone from 9% to the current 2%. Zero percent is coming soon. And beyond zero into the pits. Your beloved China is failing again as it has always collapsed of its own grandiose and dead weight.
 
China’s doom loop: a dramatically smaller (and older) population could create a devastating global slowdown
theconversation.com

China’s doom loop: a dramatically smaller (and older) population could create a devastating global slowdown

A higher proportion of China’s population is elderly, and this will have knock-on effects on the rest of the world via their economy.
theconversation.com theconversation.com


China has announced that in 2023 its population declined from 1.4118 to 1.4097 billion people. Forecasting by the UN suggests China’s population will dip to 1.313 billion by 2050 and then down to about 800 million by 2100. This is a significant change and will have ramifications well beyond its borders.

There are two trends that underline such a demographic shift. First is the ageing population with the percentage of those aged 60 and older currently above 20% of the total population. Second, birth rates have dropped significantly, from 17.86 million births in 2016 to 9.02 million in 2023. Several interrelated economic consequences of such shifts could emerge which ultimately can affect China’s economic wellbeing in the mid-to-long term and resonate globally.
 
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