Chinese economic collapse, 'Dubai times 1,000'

Chinese economic collapse, 'Dubai times 1,000'

finance.yahoo.com

As most of the world bets on China to help lift the global economy out of recession, Mr. Chanos is warning that China's hyperstimulated economy is headed for a crash, rather than the sustained boom that most economists predict. Its surging real estate sector, buoyed by a flood of speculative capital, looks like "Dubai times 1,000 -- or worse," he frets. He even suspects that Beijing is cooking its books, faking, among other things, its eye-popping growth rates of more than 8 percent.

(visit the link for the full news article)

Well if this guy is correct and I can't help but meet this story with a bit of skepticism it would mean a huge change in the golabl economy and especially for America. I do not understand global economics that well so if anyone can help me understand the implications a little better I would really appreciate it. Also what will happen with all of the U.S. debt China has collected, nothing or will we be in trouble?

finance.yahoo.com (visit the link for the full news article)

Dubai x 1000? Is this guy a moron? More like America times a thousand. HAHA! What's going to happen to China is already happening here in the US. Hyperstimulated economy? CHECK!
Government bailouts? CHECK
Overextended real estate market aka speculative real estate capital? CHECK!

What this idiot fails to realize is that China is IN DEBT TO NO ONE! Unlike Dubai and America China OWNS other countries' debt. This guy is another useless talking head on Wallstreet just trying to make money. He doesn't care about anything else...........least of all his own country that has made him filthy rich while everyone around him is losing their rear end. Another empty WallStreet suit.

[edit on 9-1-2010 by Zosynspiracy]

Sorry.
Wrong link.
Here is the story I was reading this morning.

China hikes rates on bubble, inflation fears

With the cost of real estate soaring and the price of food creeping higher, China’s central bank has begun to rein in its record fiscal stimulus over fears that asset bubbles and inflation could destabilize the economy.

The People’s Bank of China began selling its three-month bills at a slightly higher interest rate Thursday for the first time since August, a move aimed at mopping up excess liquidity brought on by the $1.35 trillion in new loans issued between January and November last year.

The move is expected to send a signal to China’s commercial banks not to replicate the lending binge of 2009 as policymakers attempt to prevent the nation’s economy from over-heating.

[edit on 9-1-2010 by SLAYER69]

reply to post by Misoir


lol not a chance mate

over 1 billion assests in china


not a chance.. only for china your ass and mine would be in a line collecting soup

fact

reply to post by Misoir


I think by saying they are close to collapse , this is telling the US ,

Sorry , we can't help you to buy your Debt anymore.

I think the Fed bought 80% of their debt at the last auction .

looks like they will be buying more this time, lol.

BUYING YOUR OWN DEBT , great country.

INFLATION ANYONE ??

reply to post by Sean48


Has anyone else noticed the cost of food has gone up alot more than usual this year? Or maybe it just has to do with my state but I mean all of the food has really rose in price in just 1 year. Perfect year for that too!

Completely plausible in my opinion. China has pegged their currency to the dollar for over a decade and has purchased a great deal of foreign debt. Additionally, they hold hundreds of billions in bunk investments. Now that the global market for their products has bottomed out, they aren't taking in the kind of revenue that they once were. I wish I could find the story, but I was reading about 3 or 4 months ago about how Chinese warehouses are filled to the rafters with goods than no one is buying.

Let's face it, China has been waging assymetrical warfare on the US for almost 20 years with its weapons being primarily economic. The same way the US bropke Russia, China is breaking the US. The problem is that in breaking Russia, we broke ourselves. China will find the outcome to be roughly the same for them. Even the assets that they hold were purchased at the top of the market - never a good idea. They will find themselves over-leveraged with several bubbles bursting at once.

Rest assured, NO ONE is immune from what is happening to the global economy. NO ONE!

Originally posted by 13579
reply to post by Misoir

 

not a chance.. only for china your ass and mine would be in a line collecting soup

fact

Chinese Stimulus Package Anybody?

Most of that has been financed by their Government.
[atsimg]http://files.abovetopsecret.com/images/member/66382a9959e6.png[/atsimg]

Who owns most US debt?
[atsimg]http://files.abovetopsecret.com/images/member/4dfcc6bbf9d4.jpg[/atsimg]
[atsimg]http://files.abovetopsecret.com/images/member/f8db83721788.jpg[/atsimg]


[edit on 9-1-2010 by SLAYER69]

Originally posted by 13579
reply to post by Misoir

 

lol not a chance mate

over 1 billion assests in china


not a chance.. only for china your ass and mine would be in a line collecting soup

fact

...or 1 billion liabilities when resources become scarce.

especially food.

The chart is wrong ... the stimulus wasn't only 700 billions but several trillions... around 25... ++ so the ``stimulus`` aka saving the bankrupt banks for a time, is 200% time the GDP.

reply to post by kozmo


Here is another perspective. It's an interesting article.
How a Chinese Real Estate Bust Could Hurt the U.S.

China and the U.S. are locked in a sort of economic mutually assured destruction, in which we need them to lend us money and they need us to buy their low-priced products. So if China's economy gets into trouble, the U.S. will feel the effects. That's why reports of a possible real estate bubble in China matter to people in the U.S. The evidence supporting the China bubble case is compelling, but the challenge is to figure out when the bubble will pop and how China will react.

Before looking at these questions, consider the evidence suggesting a Chinese real estate bubble. The New York Times reports that super-star short seller James Chanos -- who bet right on the collapse of Enron -- has now set his sites on China's real estate market. Chanos views China as "Dubai times 1,000 - or worse" and suspects that Beijing is faking its reports of 8% GDP growth, according to the New York Times.

reply to post by SLAYER69


Nice charts , picture is worth.....

I'd be curious as to where China spent that stimulus on.

Infrastucture, things of that nature.

reply to post by SLAYER69


YUP! Exactly what I've been saying! There is no way one of us falls without taking the other down with it. Both countries are grossly over-leveraged - they BOTH bet the farm on the wrong horse. It will be interesting to see if both governments stop dithering and start working together to fix this mess.

Originally posted by Sean48
reply to post by SLAYER69

 

Nice charts , picture is worth.....

I'd be curious as to where China spent that stimulus on.

Infrastucture, things of that nature.

Yes Infrastructure and cheap questionable loans.

As far as infrastructure goes... They have financed China's expansion. It will equal the US's infrastructure by 2015. The issue there is that the US Infrastructure accommodates a population around 309 Million vs China's 1.6 billion.

As far as those Cheap loans. This seems to be where the issue is.

reply to post by 13579


Don't confuse Nationalism with CORPORATISM
Understand what's happening. The US is loosing jobs domestically and they wont come back as American Companies are also in the mix pumping Billions of dollars into the Chinese economy in search of ever increasing profits.

When that well runs dry...
And It Will in Time.

They will simply move on to India, The African continent or South America etc.

GM sales in China surge 67 percent in 2009

General Motors sales in China surged 67 percent last year, the company announced Monday, as the automaker and its joint ventures exploited rising affluence there to sell more than 1.8 million cars and trucks.

GM, already among the most important auto manufacturers in China, said the market share of its Chinese ventures rose to 13.4 percent, up 1.3 percentage points from 2008. Leading the company's sales in China were Buicks, as well as inexpensive small vans and pickups.

IBM Will Offer China Financing

International Business Machines Corp. said it will launch a financing business in China with chip maker Advanced Micro Devices Inc. as its first client.

IBM will provide accounts-receivable lending, also called factoring, to AMD, providing them with upfront payment while they wait up to four months to receive payment from a customer.

IBM spokeswoman Harriet Ip said the deal would generate "hundreds of millions of dollars" of business for IBM this year. IBM also anticipates adding new customers for the financing unit.

The move highlights how IBM is branching into service, consulting, and financing businesses in China that are far removed from its original core business of manufacturing computers.

Does the band wagon effect have merit in the Chinese economy?

A lot of global CEOs, of course, are on the thank-God-for-China bandwagon, and it might seem a little churlish to question one of the world's few good-news economic stories. Yet a growing number of observers believe that China is creating its own bubble economy. And they have a case to make.

money.cnn.com...

[edit on 9-1-2010 by jam321]

reply to post by SLAYER69


Question for you


let's say you loaned me 2 trillion dollars, meaning I am in debt to you for two trillion dollars.

Who really has the problem, me or you?

Originally posted by jam321

Who really has the problem, me or you?

People tend to forget this when they hear about B.R.I.C. trying to devalue the dollar.

Originally posted by Misoir

so what will happen with all of the U.S. debt China has collected, nothing or will we be in trouble?

I dont know, but I am hoping they will accept all of our politicians as ransom until we pay them back. Wont that be nice. We can find new homes for all of our vultures, errrrr, leaders, AND pay China back slowly at our leisure. After all, we wont miss them much.