“In July last year, Chinese scholar Zhang Dandan, an associate professor at Peking University, stated in a research article that if the approximately 16 million young people who are doing nothing but mooching off their parents were considered unemployed, the actual youth unemployment rate in March last year would have been as high as 46.5 percent.”
Economic distress has toppled virtually every empire from Rome on down to Soviet Russia.
The CCP largely made a devil's bargain with the Chinese people in the aftermath of the 1989 Tienanmen Square massacre: deliver the veneer of economic prosperity without granting political liberty.
This is now coming back to haunt the CCP, because there is no way to foster structural economic prosperity without granting structural political liberty. The two paradigms are inextricable the one from the other.
Power, and political power especially, has a remarkable facility for turning even the smartest of people into complete blithering idiots. No, the CCP does not see this, any more than the Uniparty corruptocrats in the DC swamp can see it.
Government officials will always conclude that the solution to society's ills is more government.
Sane and rational people will always conclude that the source of society's ills is more government.
Most of us probably don’t get to know our full impact on the world, or what our best contributions are. Somewhere in the world today is a young person reading your Substack, being profoundly affected by it, and then going on in life to be a Senator or President because YOU opened his eyes, impacted his soul, and led him to lead society back to sanity. Your writings matter, Peter - and thank you!
As always, Peter, I am impressed that you can succinctly make sense of convoluted data and explain it so well. “Beijing is stuck in a policy straitjacket” sums it up perfectly. China is in deep trouble and cannot win. I get the sense that all of their officials now are just trying to placate their political bosses enough mismatched policy decisions in a futile effort to keep from being blamed for the impending economic disaster. (Run!)
They are so thoroughly painted into a corner that what will be interesting now is how it affects the rest of the world. For example, I’ve read that Vancouver, BC has had, for several decades now, a large population of Chinese ex-pats. It would be interesting to see the growth rate of that
The great question for the world economy is what happens if/when China exports its deflation to the wider world.
If China should succeed in goosing domestic output while its economy is still largely export driven, there will be a deflationary impulse that will have to move through the world economy.
Conversely, if China's production infrastructure seizes up as a result of financial imbalancees, they account for enough of global output to send an inflationary impulse through the global economy.
In short, whichever economic poison China opts to quaff, the global economy gets to gulp down the other.
No kidding - and we Americans peasants get to pay! I know we can count on you to show us the first data showing up, whether it’s inflationary or deflationary. I also know that deflationary is the worse scenario, butI can’t help hoping that prices go down at the grocery store!
(Oops) population over the past few years, and into the near future. Are Chinese running to Vancouver now in droves? Are real estate prices there soaring because so many wealthy Chinese trying to buy homes near their relatives who left China a few years ago? And where else will we see real estate prices go up because of affluent Chinese running away - probably no longer New York, so where - Houston? Data would be interesting.
“In July last year, Chinese scholar Zhang Dandan, an associate professor at Peking University, stated in a research article that if the approximately 16 million young people who are doing nothing but mooching off their parents were considered unemployed, the actual youth unemployment rate in March last year would have been as high as 46.5 percent.”
(From today’s Epoch Times: https://www.theepochtimes.com/china/ccp-released-unemployment-rate-definitely-concerning-for-chinese-economy-experts-say-5611696?utm_source=ref_share&utm_campaign=copy)
Add THAT to China’s hopeless dilemma - 46.5% of China’s youth unemployed?
The question is whether China will have a long deflationary period like Japan had, or if China will explode into public revolutionary turmoil!
Economic distress has toppled virtually every empire from Rome on down to Soviet Russia.
The CCP largely made a devil's bargain with the Chinese people in the aftermath of the 1989 Tienanmen Square massacre: deliver the veneer of economic prosperity without granting political liberty.
This is now coming back to haunt the CCP, because there is no way to foster structural economic prosperity without granting structural political liberty. The two paradigms are inextricable the one from the other.
You are so wise. I wonder how many officials in the CCP can also see this, but have no recourse except to fiddle while their Rome burns?
Power, and political power especially, has a remarkable facility for turning even the smartest of people into complete blithering idiots. No, the CCP does not see this, any more than the Uniparty corruptocrats in the DC swamp can see it.
Government officials will always conclude that the solution to society's ills is more government.
Sane and rational people will always conclude that the source of society's ills is more government.
Most of us probably don’t get to know our full impact on the world, or what our best contributions are. Somewhere in the world today is a young person reading your Substack, being profoundly affected by it, and then going on in life to be a Senator or President because YOU opened his eyes, impacted his soul, and led him to lead society back to sanity. Your writings matter, Peter - and thank you!
Thank you for the kind words. They are greatly appreciated.
As always, Peter, I am impressed that you can succinctly make sense of convoluted data and explain it so well. “Beijing is stuck in a policy straitjacket” sums it up perfectly. China is in deep trouble and cannot win. I get the sense that all of their officials now are just trying to placate their political bosses enough mismatched policy decisions in a futile effort to keep from being blamed for the impending economic disaster. (Run!)
They are so thoroughly painted into a corner that what will be interesting now is how it affects the rest of the world. For example, I’ve read that Vancouver, BC has had, for several decades now, a large population of Chinese ex-pats. It would be interesting to see the growth rate of that
The great question for the world economy is what happens if/when China exports its deflation to the wider world.
If China should succeed in goosing domestic output while its economy is still largely export driven, there will be a deflationary impulse that will have to move through the world economy.
Conversely, if China's production infrastructure seizes up as a result of financial imbalancees, they account for enough of global output to send an inflationary impulse through the global economy.
In short, whichever economic poison China opts to quaff, the global economy gets to gulp down the other.
Not a pleasing prospect.
No kidding - and we Americans peasants get to pay! I know we can count on you to show us the first data showing up, whether it’s inflationary or deflationary. I also know that deflationary is the worse scenario, butI can’t help hoping that prices go down at the grocery store!
(Oops) population over the past few years, and into the near future. Are Chinese running to Vancouver now in droves? Are real estate prices there soaring because so many wealthy Chinese trying to buy homes near their relatives who left China a few years ago? And where else will we see real estate prices go up because of affluent Chinese running away - probably no longer New York, so where - Houston? Data would be interesting.