The entire Chinese economic miracle is a debt financed farce. Their GDP growth is a fraud. Their burgeoning middle class are nothing but delusional lemmings. The whole tettering facade is going to collapse in an epic implosion. How can anyone not watch this piece and conclude that China and the rest of the globe are in store for a world of hurt? Even the smart Chinese billionaires know they are in the midst of a bubble. There is one absolute about bubbles. They ALWAYS pop. They don’t deflate slowly. I believe China’s bubble is popping as we speak and they are covering it up with fraudulent economic reports.
He’s showing us around the new eastern district of Zhengzhou, in one of the most populated provinces in China – not that you’d know it. We found what they call a “ghost city” of new towers with no residents, desolate condos and vacant subdivisions uninhabited for miles, and miles, and miles, and miles of empty apartments.
Lesley Stahl: Why are they empty? I’ve heard that they have actually been sold.
Gillem Tulloch: They’ve all been sold. They’ve all been sold.
Lesley Stahl: They’ve all been sold? They’re owned.
Gillem Tulloch: Absolutely.
Owned by people in China’s emerging middle class, who now have enough money to invest but few ways to do it. They’re not allowed to invest abroad, banks offer paltry returns, and the stock market is a rollercoaster. But 15 years ago, the government changed its policy and allowed people to buy their own homes and the flood gates opened.
Gillem Tulloch: So what they do is they invest in property because property prices have always gone up by more than inflation.
Lesley Stahl: And they believe it will always go up?
Gillem Tulloch: Yeah, just like they believed in the U.S.
…
Lesley Stahl: Giant cities being built with people not coming to live here.
…
Gillem Tulloch: Yes. I think they’re building somewhere between 12 and 24 new cities every single year.
Unlike our market driven economy, in China it’s the government that has spent some $2 trillion to get these cities built – as a way of keeping the economy growing. The assumption is “if you build it, they’ll come.” But no one’s coming.
…
Lesley Stahl: And it’s all Potemkin.
…
Lesley Stahl: So if the bubble bursts, who’s left holding the bag?
Gillem Tulloch: There are multiple classes of people that are going to get wiped out by this. People who have invested three generations worth of savings — so grandparents, parents and children – into properties will see their savings evaporate. And then, of course, 50 million construction workers who are working on all these projects around China.
Translation:
The Chinese slaved away in export businesses and saved money in houses.
Only, they owned only a small portion of the house. The Bank the rest.
Once they can no longer pay the mortgage , the Bank gets the house.
But the bank goes bust, so the Government gets title to all the houses.
Just think about it. The Chinks think they have been working for themselves but in reality
They’ve been working for the Government all along!
Mark
Wrong again. The banks are the government. The Chinese don’t have 30 year mortgages. The people borrow from shady underground loan sharks and pay for the real estate with cash. When they can’t pay, they get murdered.
Every now and then MSM gets it right. ♥ for Lesley Stahl and Gillem Tulloch.
This is the third time this I’ve seen this video segment on 60 min. But I sit there and watch it again in sheer amazement of this sad and eerie phenomenon. If only China would have allowed their people to make foreign investments, things could have been different for them.
They’ve displaced their own working poor to die if they must, and robbed their middle class to produce modern day ghost towns. Mind boggling – Stupidity
No one wants to live in the Ghost Towns, because it’s too eerie, expensive, and dangerous.
One of the most horrific images I saw early this year was a poor Chinaman living in a cage or “coffin home.”
Hong Kong’s Poor Live in Cages
Mind boggling – Merciless
But it’s cruel, that any human being would be subjected to living in a cage outside of prison.
Hilarious. Americans are wishing, hoping and praying China will collapse. They have $12 trillion in debt. They have “ghost cities”, they have a housing bubble, and their growth has slowed from 7% to 4%. Meanwhile, they let failing banks fail, bankrupt businesses collapse, have accumulated the largest gold pile in the world, and have devalued their currency not at all.
We spent close to $12 trillion bailing out our insolvent banks and keeping them afloat so they could continue to defraud the government and public. We pissed away $740 billion of taxpayer money to make the banksters whole after they crashed the financial system, and have davalued our currency by 96%.
They are also holding $2 trillion of our debt, and get $200 billion a year in cash from us alone every year, the trade deficit; China pays for their entire military every year just on money the collect from us vis-a-vis the trade deficit.
We have $56 trillion in public/private debt. We have “ghost cities” (Detroit, Chicago, Compton, San Jose, Camden, E.St. Louis, The Bronx, Cleveland, and many others), but their ghost cities are empty, our ghost cities are crime infested shitholes filled with murdering savages on welfare and food stamps which cost taxpayers more than $1 trillion per year.
China manufactures almost every single product we buy, including icrap, computers, every tech gadget, our military tech, and every other thing at every store in the U.S. (except cars, which are made in Korea and Japan). We’ve sent more than 55,000 manufacturing plants to China in the last few decades and more than 8 million manufacturing jobs.
China has purchased, with cash, businesses in Australia, Africa, Europe and the U.S. They own our largest theater chain, our largest pork producer, and a vast number of other businesses in the U.S. and vast swaths of real estate all over the world.
They consume more oil than the U.S., and have built infrastructure in Iraq, Africa and Saudi Arabia for their private oil consumption. They are allies with Russia, the second largest oil producer in the world, and have unilateral trade agreement with Russia (leaving out the U.S.)
China is the largest trade economy in the world now (we aren’t), and they are using their power to sign unilateral agreements with almost every country they trade with to drop the dollar as reserve currency. They are using the Yuan and Yuan-backed bonds in Europe, Australia, India, Brazil and Russia to end the dollars hegemony as reserve currency. And, they will be backing the Yuan with gold as a gold-backed currency is actually worth something and not subject to the whim and money printing of the Federal Reserve.
The Chinese have 1.3 billion people, virtually no welfare system, and they recently ended their one child per family laws; ie, their demographics trump the rest of the world. We pay 110 million people not to work every day, at a cost of $1.3 trillion a year (disability and welfare).
They have a production and manufacturing economy, combined with mining and other productive assets. We have a “service economy” that produces nothing, and “financialization” which produces nothing but debt.
So, you can continue to hope and believe China is going to collapse, or as somebody once said, see the splinter in someone else’s eye, while doing nothing about the plank in your eye. The socialist paradise of the USSA is in 10x worse shape than China, and is racing toward a biblical collapse. China, it seems, will be able to weather any storm, for the reasons mentioned above.
AWD
They don’t have a housing bubble. They have a housing/real estate Hindenberg. Did you watch the video? They have dozens and dozens of empty cities.
You actually believe their GDP figures? The GDP is created by building ghost cities, ghost malls, worthless dams, and bridges to nowhere. Their true GDP is the same as the US – below zero.
Their demographics are far worse than the U.S. Their population is aging at a much higher rate than the U.S., with no children to support the old folks.
Their debt levels are astonomical. They just don’t report their true debt.
China is highly dependent on resources and food (oil, copper, gas, etc.) being shipped into their country. If the oil flow stops, they are toast.
Their Potemkin economy depends on dumbass Americans and dumbass Europeans buying their shit on credit. How much longer will that last?
If you think China comes out a winner during this Fourth Turning, you must be hitting the drug stash in your hospital.
The Chinese miracle is a mirage but a much smaller mirage than the economic propaganda put out by our owners and their media. The US will be completely devastated by the total economic and cultural collapse caused by the depletion of fossil fuels as will all industrial countries. China will fare better.
The following are observations from my 58 year old brother-in law who worked throughout Asia until 1995 when he moved to Singapore and China. He is married to a Chinese born, raised and collage educated 38 year old woman, second marriage for both. They have a 2 ½ year old daughter who speaks English and Mandarin. They spent several days with us around the beginning of July.
They feel most of Asia’s problems are to blame on the English, French and Americans who come over with the Kiplingesque attitude “We’re here to assume the white man’s burden”. The Chinese are a peaceful people. A check of History reveals most of the military action has been incited by the Limes, Frogs and Yanks with the Japanese pitching in.
China has 55 minorities with each having a different dialect as the US has different dialects. Discrimination throughout Asia is mainly on skin color with the lighter skinned discriminating against the darker skinned (sound familiar). The Chinese have quite light complexions.
Most Asians are atheists following a philosophy pretty much based on the Ten Commandments and the Golden rule and not on some imaginary mystical being from outer space. Religion is the only known psychosis that is contagious with our two new religions of Keynesian economics and climate change now reaching epidemic proportions.
The Chinese have no “Social Safety Net” with Darwin given a free hand. Survival depends on “Those who don’t work don’t eat” or mainly family and extended family helping each other. The Government provides a small pension to both public and private employees, women at age 51, men at 61
The Chinese are emotionally very cold. My BIL could not show any affection to his wife around her family. My SIL came from a family of four and her father was fined for having more than one child. Now they are fined one years pay from each parent. Female babies are killed upon birth since the technology is not available to all for pre determining sex. If sex is predetermine most females are aborted. This is the only effective method of population control disregarding political and moral considerations, all else are Theater.
China is aware of the end of vendor financing and economic growth through exports and is turning inward to promote internal consumption. They are working on the pollution problem just as our government is working on problems it created.
There are empty or near empty buildings everywhere but their government doesn’t show them to foreigners. Foreign media are shown only what the government wants them to see and most media personnel are to lazy to look for themselves. Our media says what people want to hear and the government wants them to hear. The Chinese media and Government do the same.
China has 6000 years of perma culture experience while we have few beyond the Amish and Mennonites. They will fare better when Industrial Agriculture fizzles.
.
AWD
The only thing hilarious is your love affair with China …. seeing ONLY the positives, and discounting all the negatives.
China, roughly the size of the USA … yet having the entire population of the Western Hemisphere, plus Germany and France, within her crowded borders.
You rightly acknowledge peak oil and the devastating effect in ‘murica when food shortages, and other shortages of necessary materials occur. Yet, China, will be spared, or survive it? Hilarious.
You never mention or even acknowledge China’s disastrous environmental issues.
China. Boomers. Fat Phucks. Your mind is closed. But, that’s your right. Are you invested in China real estate?
Always remember the golden rule.
He who has the gold rules.
Best as I can tell those fucking bankers along with the government have sold most of the gold to the east!
for shame….
AWD
Your hatred of Americans is only surpassed by your perpetual fellatio of the Chinese Communists and their potemkin economy.
And since you hate Americans so much, why don’t you much your pampered white ass to Beijing, I’m sure you’d be much happier. their.
If China does collapse ……… AWD will blame it on Boomers.
Admin
“Their population is aging at a higher rate than the US, – – -”
How can something age faster than something else??? Only a bean counter could conceive something like that.
Wow. Looks like China is clearly going to dominate the world with really really really old people.
In order to understand what is going on in China, it is instructive to look at the longer arc of Chinese history. It has experienced not one, but several cycles of rise-peak-fall of empires. In fact, the Chinese have a nice proverb to describe this dynastic cycle: The empires go up the staircase in hobnail boots and come down the other side in silk slippers.
There are two major dynastic cycles in China that would probably be best to look at here as historical examples of what may be taking place in China right now.
The first starts in the feudal Warring States period following the fall of the Zhou Dynasty. Then came about the unification of China around 221 BC by Qin Shihuangdi. The Qin Dynasty undertook huge infrastructure improvements (unification of written language, extensive road network, Great Wall) but it was exceptionally brutal, and it was overthrown around 206 BC, shortly after Qin Shihuangdi’s death. This groundwork, however, set the stage for one of the most successful dynasties in Chinese history — the Han. They took over in the tumult following the fall of the Qin, and ruled China for the next 400 years, a period that could be described as a Golden Age. In fact, Han China was just as prosperous an empire as Ancient Rome. And it achieved this prosperity without overextending itself to the extent that Rome did, because when it finally did fall, China did not crash into a dark age on par with what happened to the Western Empire after 476 AD.
The second example is the reunification of the north and south of China under the Sui Dynasty in the late 6th century AD. The Sui undertook a huge infrastructure project — the Grand Canal, which linked the Yellow and Yangtze Rivers together — but they were so corrupt and brutal that they were overthrown in less than 40 years. However, the infrastructure that was built set the stage for another Golden Age under the Tang and Song Dynasties, lasting through until around 1300 AD.
It is perhaps best in this context to not think of the Communist Party in China as a political party in the modern sense as much as a modern bureaucratic dynasty. The CP’s own behavior at times has demonstrated this, such as the rapid response it has made to natural disasters in the country, always wary of the way that dynasties’ success or failure was governed by the “mandate of heaven”. The CP also arose out of another fractious period in Chinese history, where they had gone from one of the foremost powers of the world to the prey of Western Imperialism within a couple of centuries.
Given this historical backdrop, I think that China’s difficulties will likely spell the end of the Communist Party’s rule there. However, it will also set the stage for a new dynasty to rise, one that will build on the infrastructure that the CP has built. And regardless of how anyone feels, personally, about the CP or China in general, it is impossible to deny that they have truly made a “Great Leap Forward” over the past 35 years, rising to the level of a leading world power. And I also think that this new Chinese dynasty will see China return to its traditional status as one of the world’s most advanced and resilient cultures, even as a good part of the rest of the world (especially Western Europe and the US) fade into the background.
Hilarious (again). The Chinese make up numbers? They must have studied under the BLS and our Federal government. Nobody can trust a single number the government produces here, they’re all lies and bullshit.
Their GDP is created by production and exporting products, and they are the largest trade economy in the world (fact). What do we produce and export? Tractors, airliners, military equipment, fast food, and debt.
Their demographics are worse than the U.S? They have 1.3 billion people, no social security to pay, no Medicare or Medicaid, and no welfare. We have the massive ponzi schemes of Social Security, Medicare, Medicaid, Welfare, Disability, 90 weeks of paid vacation unemployment, totaled up, cost more than 2/3 of tax receipts a year.
We have to pay to have our military in 140 different countries around the world. We have 70,000 troops stationed in Japan and S. Korea alone, protecting them at our expense.
Their debt is massive, but more than Europe? Japan? The U.S.? I don’t think so. Do they have SS, Medicare, and pension unfunded obligations of $300 trillion? No, because they don’t even have these socialist programs.
Again, they have built refineries and gasoline production facilities in Saudi, and the same in Iraq. We spent almost $3 trillion in the war in Iraq, and the Chinese got all the oil concessions there. And their best friend is Russia, the number two oil producer in the world. Again, they have trade agreements for oil, and they are actively working to do away with petrodollars. We are the ones that are going to be stuck without oil, especially if we lose reserve currency status and keep pissing off the Russians.
The Chinese have vast coal reserves, and their population is used to “starving”, as they’ve had famines at various time for the last 5000 years. They could lose the equivalent of the entire population of the USA to famine, and still have a billion people left over. We have the most obese population on the planet, and 48 million people getting food stamps. People here are too fat to work, and it’s only going to get worse.
You do nothing but provide subjective information and “they lie” anecdotes, and ignore the facts, which is the American way these days. How the fuck are Americans, Europeans, and every other country going to stop buying Chinese products? There isn’t anything else to buy in stores, in case you haven’t noticed. Oh, Nikes are made in Vietnam, big fucking deal.
The Chinese will have a gold-backed currency. Our currency is all but worthless, four cents on the dollar. The world will go on after the fourth turning, the world has never ended, fourth turning or not. The U.S. found itself intact after the last fourth turning, and capitalized on that fact. We had production, saved and invested, produced our own products, and had a trade surplus. Today, we’ve lost 60-70% of our production, are in debt $56 trillion, buy most or all our products from elsewhere, and have the largest trade deficit in the world. We pissed it all away.
If you compare our situation with their situation, ours is 10x worse, according to facts, not conjecture. I don’t hate the U.S. dumbfuck, but I sure don’t like what it’s become. The sand is draining around our feet as we speak. I have no desire to live in China, who would?
China has been in existence since the beginning of recorded time, the U.S. has been around for 237 years. We are taking the same path as Rome before us, and every other country that has turned to socialism. If you can produce some facts to counter my claims, I will be more than happy to adjust my view. Otherwise, read for comprehension.
AWD asks how the fuck are Americans and Europeans going to stop buying Chinese produced dog shit and iGadgets.
I’ll tell you how.
When our currency becomes worthless and we don’t have anything left to buy their shit with.
You are under some mistaken notion that China can grow and prosper when the rest of the developed world implodes.
Again – you must be hitting the hospital supply closet if you think that is possible.
AWD wrote: “We are taking the same path as Rome before us, and every other country that has turned to socialism.”
Ummm… the Chinese are currently ruled by the COMMUNIST PARTY. So, how is it that they are proving to be successful while at the same time being SOCIALIST?
And, no Stuck, I have no love affair with China. I’ve been there, have you? Or anyone else on here? It’s a filthy, polluted shithole. The triad gangs support the loan sharks, who prey on the population. The government corruption is mind boggling, millions and millions of government drones, everybody has their hands in everybody else’s pocket. There’s so many fucking people there it’s continuous gridlock, you can’t walk or move without bumping into somebody. They’ve decimated their countryside, they’ve murdered innocent tribal people, they crush any dissent. They harvest organs of prisoners (but we have more people, per capita, in prison than China). They spy on and monitor internet usage, but unlike the U.S., they shut down sites, and control information flow. 95% of the people are dirt poor serfs, living in mud huts with their geese and chickens, with barely a pot to piss in. Little or no medical or dental care. Doesn’t sound like the kind of place any civilized person would want to live in.
“I’ve been there [China], have you? ” ——— AWD
Yup. I went to a Walmart a while back. Close enough.
Admin’s comebacks are getting shorter, that means I’m winning.
It’s obvious that if nobody has any money to buy their products, they won’t be selling any. The dollar and Euro won’t become “worthless”, unless we have hyperinflation.
But, in order to humor you, I’ll give you an example:
Say Europe and the U.S. do collapse. And China is still holding $2 trillion in treasuries. Are we going to stiff ’em? Or commit economic suicide by hyperinflation? Will they accept what gold we can scrape together to pay off the debt? Or just give them California and call it even?
Or will American and European citizens start using a gold backed currency? The very same gold backed currency that will allow them to keep buying the crap they’re used to buying? If the Chinese are handing out money that will buy stuff, people will use it.
We have reserve currency status now. That means, when I go to Colombia on a cruise, and get off the boat, and want to buy something, I use dollars. Or exchange them, but I don’t have to, I can just use dollars. If dollars and Euros are now worthless, what are people going to use? A gold backed currency would make the most sense. The Yuan is the only candidate for such status.
I don’t think most people understand this. China needs the rest of the world to collapse to take over reserve currency status. It’s the only way.
AWD’s responses are sooo long because he knows he’s losing. Volume doesn’t matter. Facts matter.
The facts are on the side of Admin.
I always win.
AWD
You missed your calling. You spend your days extracting things from asses, when you should have been an economist. Your analysis is breathtaking to behold.
China’s $2 trillion of Treasuries will automatically become worthless when the U.S. economic system implodes. Treasuries lose value when interest rates rise. If we have a deflationary collapse, the dollar becomes worthless.
Reserve currency status is old school dude. When the collapse arrives it won’t benefit anyone. You are caught in the past man. The future won’t resemble the past.
Globalization and massive amounts of international trade will be a historical footnote that lasted less than 100 years.
They are communists. They get medals, when they fuck the middle class. I think AWDs facts are very interesting to hold against that article. So, it´s a so-so situation, it seems… 4%?
OF wrote: “They are communists. They get medals, when they fuck the middle class.”
Considering that the leadership of both major parties in the US fuck the middle class, does that mean that they’re communists too?
I caught the tail end of that 60 minutes expose on the Chinese real estate market….Very interesting stuff…it seems as though there is an inverse correlation between the U.S. economy and Chinese economy…
China has GHOST CITIES, which we have discussed ad nauseum here on TBP, but what I didn’t realize that 60 minutes touched on is JUST how many and how massive these empty cities are! WTF do the CHINESE people know that we don’t??!! Did you see part of the 60 minutes interview when they showed the various ghost cities! One was named THAMESVILLE….recreated to look just like the architecture found in towns near the Thames river in England!!! Apparently the Chinese even have begun building a massive city to resemble the financial district in New York; including Rockefeller Plaza! Training buildings?
In the interview it discussed the difficulties that the Chinese “middle class” are having trying to invest their money inside their country….residential real estate and the “ever increasing” property prices are prime investments…I wonder how long it will be before the Chinese are permitted to begin investing overseas…the Opening up of the World to China and in the process China to the World….Maybe all those empty cities will be used to entice prospective renters for the Chinese middle class so they can actually get a return on their investments other than hoping that the property values will continue to go up and that they can refinance and EARN a perceived profit!
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We can trade charts all day long. Yawn. Who cares if they have an aging population? They live with their kids until they die, they have no Social Security and Medicare draining their incomes, and, wow, they actually revere their elders in Asia instead of throwing them into nursing homes. We have $240 trillion promised for SS and Medicare recipients, which they will never see. China has $0. Another argument shot down. You got anything else?
AWD is showing signs of desperation.
We are talking China, not the US.
I already know the US is fucked.
You are under the delusional notion that China can thrive without the US and Europe.
China has grown their GDP by building shit they don’t need and feeding the debt fueled consumption of the rest of the world. The debt fueled consumption of the rest of the world has reached its zenith and will now recede for decades. The middle class Chinese invested their money in the worthless real estate built by the Chinese government.
You are under the quaint notion that these modern Chinese living in their cities can adapt to a collapse. Bullshit. They will be angry and hungry. Revolution is a high likelihood in this communist dictatorship.
So Solly. You and Smokey are wong.
AWD thinks the modern world will trundle on and his high tech gadgets in the hospital will keep working.
It’s clear AWD thinks cheap plentiful oil will keep flowing for decades. How precious.
You need to extract your head from your ass and deal with reality.
Kunstler’s and Orlov’s vision of the future is based upon easily quantifiable facts. Your delusions of a continuation of the world as we know it will be crushed on the rocks of reality.
No currency named “juan” will EVER gain reserve status.
When I was growing up just outside bean town, down by the river Charles, I remember one day fish by the score washed up on the banks deader in a doornail 1/2 mile upstream from Watertown square. Today the reality is the Charles is clean enough to swim in but the lingering memories of a polluted river over ride the reality.
Reality, China is going through much the same thing and in 10 or 20 years some of the polluted parts will get cleaned and mother nature will get restored.
In the meantime dont forget the golden rule 😉
Reserve currency status doesn’t matter? Bwahahahah, yea right. And no more trade between nations? I guess Admin figures we’re going back to the stone age. You’ve been reading too much Kunstler.
No Juan currency? Hilarious, the Korean currency is the “Won”, same pronunciation.
Admin and AWD
I believe you are both right in some respect….Of course China holding 2 Trillion in treasuries would be hurt severely by the destruction of the U.S. dollar….this is why they are buying GOLD and creating new trade agreements with countries like Russia, Iran, India, South Africa and Brazil (major players on multiple continents). These agreements are attempting to work around the PETRO DOLLAR enforced through Bretton Woods so that when the collapse of the dollar does occur the Chinese will fair much better than the U.S. Wouldn’t both of you agree?
Disclaimer: I really do not understand international currency economics.
Things I found roaming around Mish’s website;
— China’s bond markets are not big enough or deep enough for the Yuan to displace the US dollar
— Contrary to what most think, having the reserve currency is a a curse more than a blessing.
— Neither China nor the US wants to be the global reserve currency.
— The US treasury department, President Obama, Mitt Romney, and especially Ben Bernanke all want the Yuan to rise.
—- China does not want the yuan to rise because of export issues.
— No country is acting as if it wants ownership of the reserve currency, precisely because no country does want ownership of the reserve currency. Currency wars are proof enough
— the greatest hurdle is that the yuan is tightly controlled … “currency manipulation” …. keeping the yuan artificially low in order to protect Chinese exports … this will likely never change as the Chinese just can’t help themselves
— AWD is full of shit
Those empty cities are amazing – I had no idea there were that many of them.
Did they build the jobs and factories too?
What are the people supposed to do for money when they move in?
@AWD – you are so fucking smart that it excites me. Lol. Your analysis of China is spot-on. Yes, I have been there, and culturally I have strong ties to East Asia.
China has now modified their 1-child policy, and the Chinese are eager to have larger families. China is going to allow some controlled population growth now. I don’t think their ghost cities will stay vacant forever, and their population is poised for a mass migration from farms in the country side to cities. When you have 1 Billion people to move around, that is an aweful lot of housing. The first difference with China is, much of their population lives in primitive substandard housing (dirt floors, pigs and chickens in the living room, no indoor plumbing, etc). If the Chinese all upgraded to “Western” standards of housing, their “ghost cities” could be full tomorrow with need for much more modern building. They could build for the next 25 years. The second biggest difference between China’s housing “bubble” and ours is population density. The Chinese still live tightly packed with multiple generations or extended families squeezed in one home. Yeah, they have some “ghost cities” but how many vacant housing units will they have when more Chinese families start living “Western” style with only 1 or 2 people per unit? Everything would be full, with a desperate need to build more. Meanwhile, back in the USA people already live in households of about 1.7 (it’s under 2, can’t remember exactly) and we took on more and more debt to build more and more housing – what the fuck? Of course our bubble popped, we already live in the smallest family units possible, and most people in the US have fully modern plumbing, electric, HVAC, sewer, garbage service etc — there isn’t much demand to build new housing in order to upgrade to “modern” features because we have had those for 60+ years! Comparing the Chinese housing situation to Murica’s is like comparing persimmons to apples.
SAH
The housing that has been built costs $100,000 and up.
The average ANNUAL household income of a Chinese family is $2,100. It’s $1,600 in the rural areas. They would only have to work for 50 years to afford these houses.
Very very few people will ever be able to afford the housing that has been built.
Your peasants moving to the city scenario is a joke. They have no education, no money, and no skills – but they can afford these houses?
You and AWD should form your own economics firm and sell your advice.
@theDudeAbides
Great screen name btw!
I gave you a thumbs up for your comment! It reminded me of a quote from a Canadian globalist douchebag by the name of Maurice Strong who was former senior advisor of the United Nations’ Secretary General and played an instrumental role in the GREEN MOVEMENT’S plan for carbon capping and trading carbon credits!
“I am a socialist in ideology, a capitalist in methodology” -Maurice Strong
The phrase “Do as I say not as I do” comes to mind when trying to wrap your head around his autocratic statement! The same with Al Gore or any politician who flies around the world on private jets and owns multiple mansions in multiple states and countries who tries to tell us to DO OUR PART by monitoring our CARBON FOOTPRINT with our meager means of transportation and consumption.
The carbon footprint will be the impression left from the BOOT HEELS stomped on our faces this time around in History from the brainwashed and fearful jackbooted Green Shirt sheeple!!!
Its more likely that China will use their new peasants as throwaways for some land grabs in Russia/SE Asia/India.
@Admin
You mention a bloody revolution…I believe the 60 minutes interviewer mentioned that China has a new President…I wonder if this “NEW” president will be presented with a dilemma (i.e. riots and protests as the global economy slows)….so domestically there will be great pressure to “fix” the problems. In the 60 minute video the billionaire business woman interviewed said that “democracy” is yearned for in China. I laugh because the “desire for democracy” always precedes a civil war…at least as of late in the Middle East and now South America. The Chinese will be pacified with the implementation of illusory democratic practices already perfected in Great Britain and its colony the United States….this would “OPEN UP” China wouldn’t it? The President will look like a genuis and “FOR THE PEOPLE!” when in actuality he is just fulfilling the Agenda one step further to an open World Government….The synthesization of most Countries’ laws on the planet to fall under the U.N. Declaration of Human Rights is in full force…this is why semi-regional agreements and institutions are needed so as to gradually and methodically, so a critical mass of indidivuals does not find out too soon (since timing is everything), bring everyone under specific rule the perceived legal consensus.
So going back to my original question….When, not if, these riots begin to occur what do you think, given the bigger picture, do you think China will do and how will this affect the rest of the world?
platoplubius
When the riots start in China the Chinese authorities will crush it without hesitation. The question will be whether it works. There are a lot more peasants than soldiers & police. The real estate collapse will create millions of angry desperate people.
Thanks SAH, at least somebody understands what is going on.
I lived in S. Korea for two years. What you quickly realize is these people (Asians) entered modern society in the time frame of 30-50 years, whereas we took 125-150 years. Japan modernized first after the war and with our support. We actually sent them plans to build transistor radios to get them back on their feet. Then Korea, after the war, and finally China.
The Asians are masters at copying, not designing or inventing. They copied everything successful about the U.S. and Western society, while discarding all the negatives (unions, immigration, welfare etc.). The beat us at our own game. But they didn’t evolve into success, it was thrust upon them, and their governments allowed virtually no consumption or imports, while putting all their effort into exports. This made them very rich, but their adaptation of western ideas of housing, roads, infrastructure is/was non-existent, since just copying it didn’t come with plans on usage. So, they copy our cities, and then don’t know what to do with them. Maybe they could import some people from Detroit into their ghost cities. That would finish them off pretty quick.
AWD wins this one. His arguments probably have some validity, I don’t know, I’ve never been there. But.
It’s really very simple, the golden rule. He who has the gold makes the rules. China is collecting while ‘we’ are dumping. They will come out on top and be the next world superpower. Better learn Mandarin quickly, like Jim Rogers suggests.
“AWD wins this one” ———- porter
Fuckoff. I and I alone have been chartered to settle disputes. Get lost. Don’t you have some luggage to carry?
You have a million dollars. I ask to borrow it. You lend it believing I will pay you back. I spend it. I have no way of paying you back.
I ask you Mr. Luggage, who is fucked? Me? Or YOU??
Nice debate. But it’s a geopolitical game for the remaining relatively cheap oil, and China has far less important playing pieces (carrier groups and bases) on the board. For that to be overturned any time in say oh the next 25 years, an internal collapse of the political and economic system in the U.S. would have to happen. If anything the opposite is occurring: a stable but corrupted government, with just enough bread and circuses to buy off any serious challenge to this status quo domestically, and more than enough military power to enforce it globally.
I think there will come a point where the ROI of running this quasi-empire becomes too low with too many costs and that internally-driven collapse occurs– but hard to see that in the near term. So if push comes to shove over “maintaining our way of life,” it’s hard to envision a scenario where China comes out on the winning side. 100 or 500 years from now? Who knows.
Fuckoff yer own self Stuck, you a poor loser! and no you canna borrow a mil from me, you have proven to be un trust worthy. I’m not that big a fool. I keep checking my email for the 25 dolla music winnings that you promised me. It becomes clear once a bit of logic is applied who is not only lost but also a loser. I’ve got the million, you want it. ha ha.
AWD does a victory dance.
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Oops,
China’s $1 Trillion GDP Lie
Submitted by Tyler Durden on 08/13/2013 – 15:37
From goal-seeked GDP, manipulated inflation, liquidity-flow-exaggerated trade data, and hidden (and divergent) PMI details, the question of the unreliability of Chinese data is not a new one. However, anecdotes aside, a new study from Peking University finds, conservatively, correcting for housing price inflation in the Chinese CPI data adds approximately 1% to annual consumer price inflation in China, reducing real GDP by 8-12% or more than $1 trillion.
@ ADMIN
I agree, the riots will be met with force…INITIALLY. But when the don’ subside and enough “international outrage” occurs the pressure domestically and internationally will be too great to resist “CHANGE?”!
Crisis breeds opportunity, atleast according to thinkers like Obama’s buddy Rahm is infamous for saying, more or less.
I give this one to AWD on points. It is a close decision, as Admin has some nice, pretty charts.
China is going to suffer some enormous lumps. But they have some significant advantages over the US.
First, they have the US by the nuts with respect to the US owing them money. Will there be a default on that? Perhaps.
Second, the Chinese take the long-view of things. They are not swayed by short-term gain to the extent the US is. They are patient mofos. The US takes the short-term view of things, and it is a huge mistake.
Third, Chinese are accustomed to, well, living on a bowl of rice. They will be able to withstand hardship much more easily than the US will.
Fourth, those $100k aprtments are going to drop in price. The owners are going to take a pounding, but the less well off will benefit. Where the energy for those apartments come from is a horse of a different color.
Fifth, the Chinese are far less multicultural than the US is. That means they will do a better job when the shit hits the fan.
Sixth, the Chinese government does not have to fool around with little things like laws, etc. They can and do do exactly what they please. I think that will be quite and advantage for them when the turd hits the toilet bowl.
Sixth, the Chinese are unarmed. US citizens are armed. Unrest will be crushed in China, as the Admin says.
Did I mention the gold that China is hoarding? They may well leverage that into their currency becoming either an independent currency, or the world reserve currency. That would be an enormous boon.
Also, mu\y friend Smokey says that the Chinese are going to thrive. He is a smart sumbitch, and I always valued his opinion.
So, I think China is going to suffer some setbacks, but they are positioned to ride them out relatively better than the US is.
You people keep blathering on about China’s gold. Does anyone on this site care about facts? Jeebus!!!
The Frogs and Degos have twice as much gold as China.
llpoh
The median household income in the US is $50,000 and the median house price is around $200,000. That is a 4 to 1 ratio.
Are those $100,000 Chinese condos going to fall in price to $$8,000 so the average Chink can afford to live in it?
Come on man. Your analysis is that they will drop in price and all will be well???? Really???
What happened to the worldwide financial system when US home prices dropped 30%?
You actually think the lack of law is a long-term benefit for China? Really???
Central planning, lawlessness, and government bureaucrats did wonders for the Soviet Union.
You and AWD completely ignore their energy dependency. They need to import all of their oil. Their export machine REQUIRES cheap plentiful oil. So Solly. That boat has sailed.
Admin – you might as well surrender. You can keep even with AWD, but he and I are of like minds on this, and so you are outnumbered 4 to 1 (I am worth three, of course.).
AWD said above re China:
“It’s a filthy, polluted shithole. The triad gangs support the loan sharks, who prey on the population. The government corruption is mind boggling, millions and millions of government drones, everybody has their hands in everybody else’s pocket. There’s so many fucking people there it’s continuous gridlock, you can’t walk or move without bumping into somebody. They’ve decimated their countryside, they’ve murdered innocent tribal people, they crush any dissent. They harvest organs of prisoners (but we have more people, per capita, in prison than China). They spy on and monitor internet usage, but unlike the U.S., they shut down sites, and control information flow. 95% of the people are dirt poor serfs, living in mud huts with their geese and chickens, with barely a pot to piss in. Little or no medical or dental care. Doesn’t sound like the kind of place any civilized person would want to live in.”
The bulk of that can be used to describe the US. Substitute bankers for loan sharks. Govt corruptio, millions of drone – check. Continuous gridlock – check. Decimated countryside – partial check. Murdered innocent tribal people – chech chech and fucking double check. Harvest organs – not that I am aware of. Monitor internet – check, Shut down sites – check. Control info – check. 95% dirt poor serfs – partial check. Medical care – partial check.
The US does not exactly sound like a civilized country either, come to think of it.
Admin – anyone actually seen that US gold lately? (The answer to that is no, as you well know. No audit of the gold in decades. No one allowed to even see in the vaults.) Also, China does not divulge its actual holdings, but there are rumours that it has quitely and unreportedly, more than doubled its reserves.
And Germany cannot even get its gold back. Go figure. Maybe the US really does not have any gold. Maybe it has all been collateralized out of existence.
Admin – I mentioned the energy thingy. I mentioned the house prices falling would bring in more potential buyers,but certaily did not suggest that the collapse would allow the rice farmers to access such housing.
The lack of law is a short-term benefit to China if the shit really hits the fan. Same way that martial law is declared in some emergencies. The Chinese will be able to act instantly without the long, drawn out processes that will happen in say, the US. Lack f law will not be a long-term benefit to them.
China is not the Soviet Unio. China actually loves capitalism, seems to me. And they are not a bunch of drunken louts.
I again say – please read this carefully – that they will suffer their lumps. But they will handle their lumps better than the US will handle its. For the reasons I gave.
China loves capitalism??? That’s hysterical!!!!
Centrally planned economy that only benefits the .01%.
Gotta love that Chinese capitalism. Ghost cities, ghost malls, ghost ports.
That chart is not correct, sorry. At current rates of acquisition, China will have the most gold in the world in early 2014.
Thanks Llpoh for your unbiased assessment of the China situation. Admin doesn’t like the little nippers.
Trying to understand the Chinese based on American values is completely nonsensical. They are nothing like Americans, they have some of our values, family, work, saving, but the similarity ends there. The Chinese, like the Koreans and Japanese, are very, very nationalistic. They are acquiring economic power to rule the world, not buy Ferraris, yachts, and live a conspicuous consumption lifestyle like in the U.S. The stupid Japanese bought into Keynesian economics, and it’s wiped them out. Their nationalistic ideas also make them dangerous as China, Japan and Korea hate each other intensely. The welfare and socialistic countries of Europe and the U.S. are headed into implosion. Like Llpoh says, the Chinese can live off a bowl a rice a day and some rat meat. Americans get pissed if they have to wait 45 seconds for their McShit’s burgers. You can’t compare the two places. It’s stupid to try.
AWD gets spanked with the FACTS about gold and rather than verify his bullshit, he just says it’s wrong.
Man. I don’t want you diagnosing me in a hospital.
Read it and weep Doc.
http://en.wikipedia.org/wiki/Gold_reserve
The Chinese not being materialistic, shallow and delusional is a hysterical observation from the Doc.
Officially reported gold reserves? Bwahahahahahahaha! Hahahahahaha! Stop it, you are killing me. You reaqlly think the US owns any gold? It is likely all mortgaged and collateralized.
Like I said – anyone actually seen the gold? I mean, anytime in the last 50 years or so (I seem to remember the last audit being 60 years ago)? And China is NOT REPORTING its gold reserves. But they are buying huge amounts of gold.
I’ve got llpoh and AWD scrambling like mangy curs trying to rationalize the FACT that Italy and France have twice as much gold as China.
llpoh
Did you see AWD’s earlier post from Zero Hedge showing that China has overstated their GDP by $1 TRILLION?
BWAAAAHHHHAAAAA
Countries that are booming always need to fake their GDP. Right?
Even our good friend Ron Paul wants an audit of the gold. No one has seen it or filmed it in years. I suspect it is prolly there, but I am not so sure who owns it.
China’s energy/resource needs: Oil ………………..Iran, Iraq CHECK
Natural gas…..Russia CHECK
Lumber…………Brazil CHECK
According to the NYTimes article below, dated June 2013, we can see who the winners and losers of the Iraq War are…It definitely isn’t the majority of the American or Iraqi people! China, already buys up more than half of Iraq’s daily supplies at nearly 1.5 million barrels a day. Here is a quote from Michael Makovsky, a former Defense Department official in the Bush administration who worked on Iraq oil policy. “The Chinese had nothing to do with the war, but from an economic standpoint they are benefiting from it, and our Fifth Fleet and air forces are helping to assure their supply.”
ALL PART OF THE OVERALL PLAN!
http://www.nytimes.com/2013/06/03/world/middleeast/china-reaps-biggest-benefits-of-iraq-oil-boom.html?pagewanted=all&_r=0
And if you ask the Chinese who will buy their shit…they will say South Africa and South America to name a few! According to a recent Forbes article about China’s rare earth production, China produces 95% of the global supply of rare earth oxides REOs…
http://www.forbes.com/sites/jackperkowski/2012/06/21/behind-chinas-rare-earth-controversy/
plato
I believe those resources are in other countries. CHECK.
China is dependent upon other countries. CHECK.
If the resources aren’t under your feet, they aren’t yours. CHECK
Admin – everyone lies. Like Omama says the uneployment rate is 7.5%. That inflation is 2.5%. That the spying is not realy spying and we have nothing to fear. Etc. Yep, all governments lie. Nothing new there.
I believe no official data to be true. None of it. And I suspect neither do you.
llpoh
China’s total reported GDP is $8 trillion and $1 trillion is fake. Another $2 trillion is from building shit that no one needs. You call this capitalism????
Can you spell war? I am fearful tht China will eventually take what they want in the way of natural resources. History repeating itself. War over resources is always a possibility.
War over resources is an absolute certainty. That is why we are in the Middle East. War with China will be the grand finale of this Fourth Turning.
Admin said, ”
Countries that are booming always need to fake their GDP.”
If everyone else is faking it…then in order to survive don’t you have to play along too? Isn’t this how ENRON handled things? This culture of deceit and betrayal to make an extra buck and earn the prestige associated with “success” in the American Dream(that most people have heard of and bought hook line and sinker) wasn’t cultivated due to competition? I am no opponent of competition as long as the game is not rigged and the rules for the game are morally based (Golden Rule for starters)! Otherwise CHEAT ON!
China has over 40 million private businesses. They employ almost a hundred million people. Not a bad start. China loves capitalism, or should I say making money.
Admin – I did not say they were fully capitalist (is the US? Hell no-o-o-o-o). I said they love capitalism. It offers the best way forward for them. They are not stupid. They understand the benefits of incentive, etc.