Is china likely to pop soon?
Discussion
I keep seeing bad news about China. Housing market, foreign trade, jobs etc. Perhaps it's just my YouTube feed... But it seems almost every day there's something new. But there also seems to be a lack of discussion on here about the Chinese economy. If it does implode, it's going to have a knock on effect. Thoughts?
I wouldn't base any investment decision on a YouTube feed or social media. Stuff like that is biased to giving you what you like to see and spouted by sensation-seekers looking for ad revenue.
If you're worried, diversify. But IMHO there's a 50% chance you'll jump the wrong way. As a seasoned old warhorse I'm quite fond of the saying 'If you're not sure what to do, do nothing'.
If you're worried, diversify. But IMHO there's a 50% chance you'll jump the wrong way. As a seasoned old warhorse I'm quite fond of the saying 'If you're not sure what to do, do nothing'.
It isn't going to grow as fast any more. It doesn't have the population to support it, nor the jobs from offshoring. The real estate bubble is an unknown however it isn't in the country's or CCP's best interests to let big lenders or real estate companies go pop.
If you're worried about eggs in one basket, China isn't a particularly big portion of the global markets. I was properly shocked to learn today that the "magnificent seven" tech stocks in the US are 26% of global market capitalisation. I've worked in equity markets for over 30 years. That's a very big stone balancing at the top of a very tall cliff.
If you're worried about eggs in one basket, China isn't a particularly big portion of the global markets. I was properly shocked to learn today that the "magnificent seven" tech stocks in the US are 26% of global market capitalisation. I've worked in equity markets for over 30 years. That's a very big stone balancing at the top of a very tall cliff.
Wololo said:
I have a totally half baked untested theory that the CCP will never allow the economy to go pop. They'll print, borrow and confiscate whatever they need to cushion the impact while manipulating external messaging to ensure the rest of the world is duped.
I agree with everything except the last phrase.The world isn’t duped…if anything the world is sceptical of anything that comes out of China and that, combined with the US approach to them, makes China all but uninvestable.
Whoozit said:
It isn't going to grow as fast any more. It doesn't have the population to support it...
Sorry to be extremely dense but can you please expand on the population bit? China has 1.4 billion people.I occasionally see people referring to China's and Russia's population "demographics problem", but I don't understand that issue either give that both nations have large populations.
Is it simply down to a potential issue with a lack of people of working age compared to how things were before? However, Germany's working population was decimated by WW2 yet within a few decades they had bounced back to be a global economic powerhouse so why can't China do the same?
Thank you.
Hereward said:
Sorry to be extremely dense but can you please expand on the population bit? China has 1.4 billion people.
I occasionally see people referring to China's and Russia's population "demographics problem", but I don't understand that issue either give that both nations have large populations.
Is it simply down to a potential issue with a lack of people of working age compared to how things were before? However, Germany's working population was decimated by WW2 yet within a few decades they had bounced back to be a global economic powerhouse so why can't China do the same?
Thank you.
Their one child policy was rather too successful. That combined with relative affluence means people aren’t having kids and their population is forecast to fall substantially.I occasionally see people referring to China's and Russia's population "demographics problem", but I don't understand that issue either give that both nations have large populations.
Is it simply down to a potential issue with a lack of people of working age compared to how things were before? However, Germany's working population was decimated by WW2 yet within a few decades they had bounced back to be a global economic powerhouse so why can't China do the same?
Thank you.
BAMoFo said:
It seems to me that a nation's GDP, and the obsession with continually growing it, is just a dick measuring competition on the world stage.
The UK's domestic issues - national debt, austerity, wealth inequality, affordability, interest rates... - would in large part solve themselves if GDP were to grow year on year for a decent period, say one parliament's worth. That's why it's so important. Whoozit said:
BAMoFo said:
It seems to me that a nation's GDP, and the obsession with continually growing it, is just a dick measuring competition on the world stage.
The UK's domestic issues - national debt, austerity, wealth inequality, affordability, interest rates... - would in large part solve themselves if GDP were to grow year on year for a decent period, say one parliament's worth. That's why it's so important. I don't think the benefits that you cite are necessarily the case. For example, it is entirely possible for the GDP of the country to increase, but for the average GDP per capita to reduce in real terms.
Edited by BAMoFo on Monday 18th December 11:40
BAMoFo said:
Whoozit said:
BAMoFo said:
It seems to me that a nation's GDP, and the obsession with continually growing it, is just a dick measuring competition on the world stage.
The UK's domestic issues - national debt, austerity, wealth inequality, affordability, interest rates... - would in large part solve themselves if GDP were to grow year on year for a decent period, say one parliament's worth. That's why it's so important. I don't think the benefits that you cite are necessarily the case. For example, it is entirely possible for the GDP of the country to increase, but for the average GDP per capita to reduce in real terms.
Edited by BAMoFo on Monday 18th December 11:40
Whoozit said:
The UK's domestic issues - national debt, austerity, wealth inequality, affordability, interest rates... - would in large part solve themselves if GDP were to grow year on year for a decent period, say one parliament's worth. That's why it's so important.
Nothing grows forever.The only issue which destroys an economy is a bloated governmental body. All government administrations in the "1st world" have grown over portionally. Look at the romans its well documented.
Whoozit said:
The UK's domestic issues - national debt, austerity, wealth inequality, affordability, interest rates... - would in large part solve themselves if GDP were to grow year on year for a decent period, say one parliament's worth. That's why it's so important.
GDP is turnover, not profit.GDP in itself is not 'more is better', it's like running a very big loss-making company.
Government and private borrowing become a problem the moment the rest of the world wants a higher interest rate than we can afford.
A bigger GDP tends to make inequality worse surely?
The value of an ordinary mortal's labour becomes smaller in the scheme of things?
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