When bubbles burst, interventionist governments generally try to reinflate them, and thus makes the entire problem worse.
China’s housing bubble has burst, and Chinese local governments are now doing everything they can to reinflate that bubble. The most recent desperation move is by cities such as Zhengzhou, capital city of Henan Province, to scrap the decades-old hukou registration system that regulates where people may obtain social benefits and buy real estate. The hope is that more people will seek to buy property there, boosting collapsing demand and helping stabilizing the quite destabilized real estate sector.
China’s hukou system has been in place since the 1950s and is tied to certain social welfare benefits, including access to health care, education, and the right to purchase properties. Recently, a Chinese province and cities with fewer than 3 million people have either scrapped or readjusted their hukou policies, with Shanghai becoming one major city offering the hukou to master’s students graduating from the city’s universities.
Zhengzhou is the largest city to scrap the policy. While any form of deregulation is likely a net societal gain, that policies which date back to the Mao Zedong era are suddenly being cast aside illustrates the enormity of the housing crisis in China and the extent of its economic ramifications. China is not experiencing an upsurge in enthusiasm for libertarian freedom of movement leading to these policy reforms, but economic collapse. This is a desperation move by local governments.
I agree completely, Peter. I specifically used that "slur" in place of the word "Communists" which I almost never miss an opportunity at, specifically because of your outstanding professionalism and my being fairly sure you would not miss the opportunity.
Even if you had not replied to my use of such irrespecutful "slang" I planned this comment.
As the language on both sides has sunken farther than I ever considered even remotely possible, we really do need to double our efforts at gentle persuasion to resist such use among our groups in general discussion, as there doesn't seem any hope on the other side whose regular activity is projection.
While there is a time and a place for satirical and sarcastic use of language to make a contrarian point, it is always vital that our otherwise noble intentions not be overcome by any lack of subtlety, nuance, or context.
My counsel to you would be extremely cautious and deliberate about such tactics. They can boomerang on you quite easily.
(I would also respectfully ask that such "teachable moments" not be employed here. I'm old enough to remember old school bulletin boards where "thread hijack" was considered extremely gauche.)
Gordon Chang has a bit of monomania where the CCP is concerned, but if you've read my other articles on what's unfolding in China, you'll understand that I feel confident that I can back my view up with hard data.
I should also point out that "Sixth Tone" presents itself as a Chinese online publication. The report on the hukou repeal and the motivation behind it as being to goose real estate sales is theirs--but the actual policy proposal by the Zhengzhou government is real. No doubt there is bias (that is a given with all media), but the facts are still there.
With the yuan sliding to two-year lows, and with Beijing retreating from the "Three Red Lines" deleveraging initiative, yes, China is employing a wide range of stimulus measures to reinflate the housing bubble. All is far from well in the Middle Kingdom.
You know, that pesky US "Silent Service" is a real pain in the ass for those chinks.
I would ask you to keep the ethnic slurs out of the comments.
I welcome and encourage vigorous debate, but I always insist that the rhetoric be kept civil and respectful towards everyone.
Disagreement is encouraged here. Being disagreeable is not.
I agree completely, Peter. I specifically used that "slur" in place of the word "Communists" which I almost never miss an opportunity at, specifically because of your outstanding professionalism and my being fairly sure you would not miss the opportunity.
Even if you had not replied to my use of such irrespecutful "slang" I planned this comment.
As the language on both sides has sunken farther than I ever considered even remotely possible, we really do need to double our efforts at gentle persuasion to resist such use among our groups in general discussion, as there doesn't seem any hope on the other side whose regular activity is projection.
While there is a time and a place for satirical and sarcastic use of language to make a contrarian point, it is always vital that our otherwise noble intentions not be overcome by any lack of subtlety, nuance, or context.
My counsel to you would be extremely cautious and deliberate about such tactics. They can boomerang on you quite easily.
(I would also respectfully ask that such "teachable moments" not be employed here. I'm old enough to remember old school bulletin boards where "thread hijack" was considered extremely gauche.)
With respect I get the sense you're channeling a bit of Gordon Chang here, but I appreciate these pieces on China.
Gordon Chang has a bit of monomania where the CCP is concerned, but if you've read my other articles on what's unfolding in China, you'll understand that I feel confident that I can back my view up with hard data.
I should also point out that "Sixth Tone" presents itself as a Chinese online publication. The report on the hukou repeal and the motivation behind it as being to goose real estate sales is theirs--but the actual policy proposal by the Zhengzhou government is real. No doubt there is bias (that is a given with all media), but the facts are still there.
With the yuan sliding to two-year lows, and with Beijing retreating from the "Three Red Lines" deleveraging initiative, yes, China is employing a wide range of stimulus measures to reinflate the housing bubble. All is far from well in the Middle Kingdom.