Great data, and you point out several aspects of the situation that other writers have not, such as the effect of shipping costs on China. I think China’s developing nightmare will be one of the most fascinating and important events of the coming year. Think of the geopolitical implications! China will become the textbook case for why co…
Great data, and you point out several aspects of the situation that other writers have not, such as the effect of shipping costs on China. I think China’s developing nightmare will be one of the most fascinating and important events of the coming year. Think of the geopolitical implications! China will become the textbook case for why command economies cannot work, or, as you’ve wisely written, “you can’t push a string”. Other countries will back off from top-down economic strategies. The Belt and Road Initiative could completely unravel, maybe even backfire in some countries. Iran will not have an economically-strong silent backer. And if China falls off a cliff, that could be a saving grace for the US economy, as investment comes to us instead of to China.
Part of me wants to laugh. The CCP wants to REQUIRE state-owned firms to bring finds held overseas and put them into the Chinese stock market! Are they nuts? Money will go down a bottomless hole, and the heads of these firms will lose pretty much everything. Does the CCP not realize what kind of revolt that could provoke? What kind of financial chaos?
I don’t wish any suffering on the Chinese people, but wow, you have not overstated your case, Peter. This really is going to be bad!
The great danger to the global economy is a complete unraveling of the Chinese economy.
China is the world's leading energy importer. A complete collapse by China (which is not an impossibility) would roil global energy markets. Oil prices could collapse--which would be bad for US oil companies. A loss of Chinese exports would upend most of the world's economies.
If China exports its deflation the rest of the world will suffer significantly.
True, but it’s a finite world, and at least in some ways the US may benefit RELATIVE to other countries. If you had half a trillion dollars to park somewhere, the US markets might seem more stable than China, Russia, Europe, South America, and so on. I’ll bet the major players of the world have already positioned themselves to benefit from China’s decline and/or instability.
Which brings me to another question I’ve been wanting to ask you, regarding Argentina. If Milei is all he seems to be, there could be an economic miracle in Argentina - although in my more cynical moments I think the situation is David vs.Goliath x 10,000. So, if China is completely tanking during the coming year, do you see that as being any help to Milei? That is, Argentina’s citizens will see, in real time, how disastrous command economies become, and this will bolster them during the initial hard times as their economy transitions away from socialism....
Great data, and you point out several aspects of the situation that other writers have not, such as the effect of shipping costs on China. I think China’s developing nightmare will be one of the most fascinating and important events of the coming year. Think of the geopolitical implications! China will become the textbook case for why command economies cannot work, or, as you’ve wisely written, “you can’t push a string”. Other countries will back off from top-down economic strategies. The Belt and Road Initiative could completely unravel, maybe even backfire in some countries. Iran will not have an economically-strong silent backer. And if China falls off a cliff, that could be a saving grace for the US economy, as investment comes to us instead of to China.
Look at this article from yesterday’s Epoch Times: https://www.theepochtimes.com/opinion/will-the-ccp-save-chinas-stock-market-5579541?utm_source=ref_share&utm_campaign=copy
Part of me wants to laugh. The CCP wants to REQUIRE state-owned firms to bring finds held overseas and put them into the Chinese stock market! Are they nuts? Money will go down a bottomless hole, and the heads of these firms will lose pretty much everything. Does the CCP not realize what kind of revolt that could provoke? What kind of financial chaos?
I don’t wish any suffering on the Chinese people, but wow, you have not overstated your case, Peter. This really is going to be bad!
The great danger to the global economy is a complete unraveling of the Chinese economy.
China is the world's leading energy importer. A complete collapse by China (which is not an impossibility) would roil global energy markets. Oil prices could collapse--which would be bad for US oil companies. A loss of Chinese exports would upend most of the world's economies.
If China exports its deflation the rest of the world will suffer significantly.
True, but it’s a finite world, and at least in some ways the US may benefit RELATIVE to other countries. If you had half a trillion dollars to park somewhere, the US markets might seem more stable than China, Russia, Europe, South America, and so on. I’ll bet the major players of the world have already positioned themselves to benefit from China’s decline and/or instability.
Which brings me to another question I’ve been wanting to ask you, regarding Argentina. If Milei is all he seems to be, there could be an economic miracle in Argentina - although in my more cynical moments I think the situation is David vs.Goliath x 10,000. So, if China is completely tanking during the coming year, do you see that as being any help to Milei? That is, Argentina’s citizens will see, in real time, how disastrous command economies become, and this will bolster them during the initial hard times as their economy transitions away from socialism....