Could Chinese gov't/economy collapse?
China produces finished products cheaper that the lowest paid third world nations. How is this so? Most likely by Chinese government subsidies (ie: printing the money they give to manufacturers). So once china's economy and society opens up more and becomes more western like, will the world realize that the yuan is really totally worthless, causing a collapse of their economy and perhaps goverment?
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Yen = Japan
Yuan = China0 -
They use prison labor (free). Its pretty tuff to beat free. 0 -
china's govt resists changing the artificially high value of its currency & that combined with the influx of money (they also own 44% of our debt) puts them in the drivers seat...they have fast tracked their development & military buildup at rest of the worlds expense...they control whats happening there like we should be doing here...they have done in 10-15 years what it took 50 to do here.... i believe they will be #1 in the world soon..... 0 -
China does not own 44% of our debt, and that figure is not even in the ballpark of our debt that they hold. In fact, it's not even in the parking lot of the ballpark of what they hold.
It's not even within sight of the area of the city where the ballpark is located.
Here, again, is a link to the holders of U.S. debt.
http://www.fms.treas.gov/bulletin/b2007-2ofs.doc
Please scroll down to table OFS-2 to find the distribution of debt ownership by volume.
Then check out this table to see how much of that debt is owned by individual countries.
http://www.ustreas.gov/tic/mfh.txt
Note the amount held by both Japan and China, especially the last six months or so.
Many of the "doom and gloom" figures relative to the percent of debt owned by all foreign entities combined conveniently, and I believe deliberately, ignore the fact that they are skewing the figures by only referring to publicly held debt, which is only a portion of our total debt since much of it is held internally within the government.
China does, in fact, own several hundreds of billions of dollars of additional debt that is connected to the U.S. but it is in many forms other than direct governmental debt, including even a considerable amount of Corporate Bonds.
Chinese citizens own additional numbers, just like you and I, but the numbers still do not even get to within a reasonable fraction of 44%.0 -
Anyone who thinks China is on the verge of collapse ... don't hold your
breath.
[xx(]0 -
even if it did 70% of the chinesse population wouldn't be able to tell the difference. 0 -
I don't think you are going to see China collapse. ...quite to the contrary, I believe they will be playing a key role in the end of the world as we know it. 0 -
China has been building a huge reserve of gold for a long time and has threatened (although I have not seen anything recently) to back their currency with gold. I don't think they will actually do it. They are much more likely to get pissed and crash the world gold market just to show how much financial power they have.
They are no where near economic collapse.0 -
quote:China produces finished products cheaper that the lowest paid third world nations. How is this so? Most likely by Chinese government subsidies (ie: printing the money they give to manufacturers). So once china's economy and society opens up more and becomes more western like, will the world realize that the yuan is really totally worthless, causing a collapse of their economy and perhaps goverment?The Chinese government keeps its currency values low by controlling where and for how much it is traded. If anything, the yuan is undervalued by a tremendous amount and would rank number two (right behind the dollar) in purchasing power, according to some economists, if it were allowed to be traded on the open market.
Right now they have us between a rock and a hard place - both of which they manufactured.
If they keep a closed monetary system, they can continue to churn out low-priced goods, thereby dominating the market.
If their monetary system opens up, they can buy us out lock, stock, and barrel, all the while subsidizing their manufacturing base even more to keep prices low.0 -
Maybe we should do what the mexes did to screw their foreign investors - devalue the dollar by a factor of 100,000, then replace the current dollar with a gold based dollar.
Doug0 -
They are working on devaluing the dollar as we speak. 0 -
They recently threatened to crash OUR economy. They actually produce things, so their economy is in a lot less jeopardy than ours (yes, they use slave labor, but at least the slaves actually produce real things that people will pay for, unlike where our economy is headed). 0 -
For my part, I quit playing chinese checkers and eating chinese food. 0 -
quote:Originally posted by slipgate
causing a collapse of their economy and perhaps goverment?
My pennies' worth: Governments don't go down without a fight.
That fight is sometimes obscure, so no one suspects, sort of like the USSR.0 -
I think its more likely our government/economy will collapse before theirs will.
But no one can predict the future, you never know.... I just wouldn't be placing any bets on it.0 -
All China has to do is halt production on everything they produce for export.
The US economy would immediately collapse. Walmart would go "out of business" almost overnight---same as many other companies. There would be wide spread shortages of every product and some foods imaginable.
China is the "world's economy".0 -
"And the meek shall inherit the earth"
-nuff said!0 -
It will not collapse, but a severe depression is looming on China's economic horizon.
China is at the stage the US was at during the 1860s. They're in an industrial boom, resulting in uncontrolled economic growth that will eventually overextend the supply of money, resulting in a financial collapse and depression. Same thing happened here in the US: look up the Panic of 1873.0 -
MND,
That's only if the Chinese are as laissez faire in their handling of the economy as the U.S. was back in the day. You forget that they have avoided the mistakes Japan and the Asian Tigers made in the 90's and have yet to fall for the same tricks we pulled on the USSR back in the 80's.
American political leaders are lawyers. Chinese political leaders are engineers and economists. There's a reason why we experience chaotic ups and downs every so often and they've managed to sustain historic economic growth.[;)]0 -
quote:Originally posted by ElMuertoMonkey
MND,
That's only if the Chinese are as laissez faire in their handling of the economy as the U.S. was back in the day. You forget that they have avoided the mistakes Japan and the Asian Tigers made in the 90's and have yet to fall for the same tricks we pulled on the USSR back in the 80's.
American political leaders are lawyers. Chinese political leaders are engineers and economists. There's a reason why we experience chaotic ups and downs every so often and they've managed to sustain historic economic growth.[;)]
When you are a "90 pound weakling", just about any exercise will show increases in your strength.
Don't get too concerned about a few years of excellent growth, wait to see if they can sustain it for a couple of decades. We've done it for far longer than that, and we still make their overall economy look like pocket change.
I'm not ready to even begin to get nervous, but you do what you wish.0 -
quote:Originally posted by MosinNagantDisciple
It will not collapse, but a severe depression is looming on China's economic horizon.
China is at the stage the US was at during the 1860s. They're in an industrial boom, resulting in uncontrolled economic growth that will eventually overextend the supply of money, resulting in a financial collapse and depression. Same thing happened here in the US: look up the Panic of 1873.
This is the most logical statement made here.
China owns the US.
China has a virtual corner on the gold market.
China could bring the US economy to it's knees.
China has made some incredble industrial advances in the past decade. Do you think they paid cash of all that expansion? I don't. WHile labor is cheap, I suspect they are in debt up to their eyeballs with cheap money. China is also extremely depentant on the United States to continue to buy their crap, so their will be no economic warfare against the U.S.
I just heard Smithfield anounced they are selling a butt load of pork to CHina. Whenever a country increases their meat consumption and imports, it tells me the urban economy is doing well. So well they can afford to buy meat and quit eating rice. The pessimist in me says, watch for the fall in the economy.
Yeah, a collapse would not surprise me.0 -
quote:Originally posted by ElMuertoMonkey
MND,
That's only if the Chinese are as laissez faire in their handling of the economy as the U.S. was back in the day. You forget that they have avoided the mistakes Japan and the Asian Tigers made in the 90's and have yet to fall for the same tricks we pulled on the USSR back in the 80's.
American political leaders are lawyers. Chinese political leaders are engineers and economists. There's a reason why we experience chaotic ups and downs every so often and they've managed to sustain historic economic growth.[;)]
Well, laissez-faire or not, the fact is China's leaders are allowing their economy to increase at a pace that will almost guarantee a financial meltdown in the not too distant future.0 -
The reasons that the PRC has, to some extent, managed to industrialise its economy are the facts that it has no environmental protection, no consumer product safety laws, no labor unions, a terribly impoverished population, no copyright or patent protection laws, etc. These will all contribute to a major economic collapse. 
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quote:Originally posted by Old Fool
The reasons that the PRC has, to some extent, managed to industrialise its economy are the facts that it has no environmental protection, no consumer product safety laws, no labor unions, a terribly impoverished population, no copyright or patent protection laws, etc. These will all contribute to a major economic collapse.
ElMuerto and O.F.: Much as I hate them, I have to admit there ARE smart lawyers, beyond their paracitism, and they may be capable of running a country. What troubles me is this: If citizenry of China is as impoverished as we are constantly being led to believe, how has their consumption of, say, petroleum, reached levels as high as ours? Surely, the activity of "running a country" does not explain huge oil consumption- we the people here are the oil users. Vehicular use there is being said to have increased many times over; vehicles need oil. So, if it is Chinese gov't that is the prime consumer, leaving the populace still grubbing, what is sustaining that government? Looks like that can't be it.
About the Engineers: We make mistakes, too. After all, isn't the fruits of our labor the main source for the lawyers' income, product liability? But, I'll bet there are damn fewer of those basta... sorry, sucking blood in China!0 -
"slave labor" or not, they're buying meat. They're importing meat. That means consumers have more spending cash. That means the "slave labor" is doing better than a year ago.
I don't pity the labor force so much. They are doing better than 5 years ago.0 -
Trade deficit does not mean 'owning the US'S debt". Just keep running to WALMART and they'll keep getting stronger!
If SOMEONE wouldn't have given the little slant eye'ed bastages 'Most favored Nation' trade status. (Slick Willy, former gov of Arkansas, and incidentally, the home state of WALMART, coincidence? ya sure, we'd be on a little more of an evenkeel with these little yellow pricks!)
Yes they do keep their 'chink change' devalued to keep the trade deficiet high.....
now if they'd just get the 'lead out'0 -
quote:Originally posted by dlrjj
quote:Originally posted by ElMuertoMonkey
MND,
That's only if the Chinese are as laissez faire in their handling of the economy as the U.S. was back in the day. You forget that they have avoided the mistakes Japan and the Asian Tigers made in the 90's and have yet to fall for the same tricks we pulled on the USSR back in the 80's.
American political leaders are lawyers. Chinese political leaders are engineers and economists. There's a reason why we experience chaotic ups and downs every so often and they've managed to sustain historic economic growth.[;)]
When you are a "90 pound weakling", just about any exercise will show increases in your strength.
Don't get too concerned about a few years of excellent growth, wait to see if they can sustain it for a couple of decades. We've done it for far longer than that, and we still make their overall economy look like pocket change.
I'm not ready to even begin to get nervous, but you do what you wish.
dlrjj,
They've sustained this level og growth since the late 80's - in short, they have been doing it for a few decades.[;)]
MND,
I disagree - they've been doing what they can to keep a tight rein on private investment while allowing almost unlimited foreign investment. I'm not sure how their stock market operates, but I'm almost certain they don't allow the sort of rampant speculation that causes us so much grief from time to time.
Mind you, I'm not saying China's invincible at this point - only that whatever bites them in the @$$ will likely be something different than what has hit us in the past. [;)]0 -
China's ability to be big and tough is directly linked to its ability to sell goods. Every day that goes by the US and China become more and more tightly interwoven. In the same way that a merchant would never throw his best customer out of the store, China will never do too much to antagonize the United States. While the US needs China a bit, China needs the US a whole lot more. 0 -
mlincoln,
Exactly.
Personally I think we should ally with them and kick the rest of the world square in the nuts. US technology and training plus Chinese manpower and utter disregard for human life equals watch out world, here come the Twin 900 Pound Gorillas of Kick @$$ in your mist.[8D]0
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