Image by Fantake via FlickrThe fact becomes even less remarkable when we recognise that nominal GDP (the appropriate comparator for nominal credit growth) grew just 3.8 per cent in the first half. In other words, 10 dollars of new loans were required to generate just one dollar of economic growth.
In fact China’s first-half growth shows one thing and one thing only: the existence of a powerful state with the ability to commandeer its citizens’ wealth and plough it into more buildings, bridges and roads, with no regard for the return those investments will bring.China is not having a special systematic strength, Kroeber argues, but might be heading for trouble.
More in a great story at the Financial Times
Commercial
Arthur Kroeber is also a speaker at the China Speakers Bureau. When you need him at your conference, do get in touch.
![Reblog this post [with Zemanta]](https://lh3.googleusercontent.com/blogger_img_proxy/AEn0k_uXcs5tMrGQbktEBYZx2MslLyFgpaKkFAM6wxbk-r51J7xv11tf4hXwg92HCvF7ZWY6gTNreGsOj5bpZAiPdPoIieT9Yrkqf84Z0b_PHlPnDkciThXMdnAiurwdswsV_hVOMzXjM03I9v4U3-DHwMVt=s0-d)
3 comments:
This is one ridiculous article that I cant help but to comment. Another guy who is ranting China envy.
Lets see how the westerners spend their stimulus:
They handed out via bailouts to save the rich. Robbing the poor (taxpayers) to give to the rich is the new age. Is AIG or Fannie Mae gonna come back to life? Is GM or Northern Rock going back to form? Not anytime soon. They have neglected their infrastructure, loss their manufacturing base and now requires printing money out of thin air to support their economies. Talk about Moral Hazard, those entities they are bailing are perennial black holes. To bail out the unproductive (Wall Street ponzi scheme crooks) vs their manufacturing industry while proudly smile to the cameras means the author like their politicians and economist have asses and shit as brains.
This author has no idea of what is going on in the real US economy with over 20% unemployment, racket of tent cities sprawling everywhere, oh wait there are more bubbles about to pop such as commercial mortgage and the mother of all bubbles the bailout bubble.
While China at least uses its stimulus wisely. They have a manufacturing base and productive industry to back their stimulus, have a surplus budget (not like the west have deficits over 70% of their GDP, UK-100%, Spain and Italy are all underwater with 132%) and have gladly return the stimulus spending to the people via building infrastructure. They may not pay off not but like any highways or subways built eventually they (the people) will come. As the US wrangle over health care, China is already putting in place a universal health care ready by 2011 and Unemployment Insurance also by that fiscal year.
As history will tell you, if China stayed intact in its worst time (1850-1949), it will stay intact and stronger than ever after the greatest depression. Unlike the Chinese people who are family oriented, the westerners does not have the support system to survive a crash. Chinese people grew up poor and can live eating sawdust, I cant see westerners doing that.
I should put this article in the anti China fodder pile. As September looms the inevitable dollar collapse seems to be glaring. Didnt all the investor newsletter warned about an upcoming bank holiday? Take your money and run now, all hell will break lose in the west. As Zbigneiw Brezinski says (Obama's advisor) there will be riots in the US soon. Lets revisit that article when this occurs, hopes the author can eat his words to see China and Asia growing and only slightly scathed while the West are in burning ruins. I can be the first to bet you that after the smoke clears there maybe a lot of NEW separate independent nations in the land formerly known as Western Europe and the United States.
So everyone whose work you post is a part of your speakers bureau?
This is not a blog then but a commercial site.
No, it is the other way around, most people whose writing I appreciate becomes also part of the China Speakers Bureau. Weblogs and commercial aspirations do not exclude each other.
Post a Comment