Yeah and Persia used to be great a LONG time ago. Honestly who cares? Yes China invented paper compass, etc. but that was a different china and a long time ago. This China is communistic and VERY backward in its political/social/justice systems. All the skyscrapers in shanghai can't make it a progressive nation.
I forgot the precise number, but because China has such a large population, and because they have so many young people as a % of their population, China has to create a very high number of jobs continuously in order to keep up with the population growth and other cycles, and to keep their employment rate stable. Now, when their exports fall by over 30%, and 50% of the factories - with factories being planned long-term capital investment - shut down in particular provinces (there is a province known for making toys, one for chemicals, one for electronics, etc., based on central planning), how the hell are they going to grow their economy at their lofty 8% target or keep unemployment from skyrocketing, unless they get an extremely quick pickup in demand from the consuming nations that import their finished goods (like the U.S.)? If consumption patterns did undergo a fundamental and psychological change, with Americans cutting out much of their discretionary spending (the 'I want it' stuff), while obviously maintaining relatively stable levels of spending on inflexible goods and services (the stuff we need to live, like groceries and utilities), what is the Chinese Bureaucracy going to do in order to manage this change in global consumption patterns? U.S. consumers and businesses buy just under 30% of Chinese goods. That's an incredible statistic if you really think about it. To say China depends a great deal on the U.S. is quite the understatement. Will they get their domestic population to make up for any significant decrease in consumption of goods that would have ordinarily have flowed to the U.S., when Chinese frown on debt and have extremely high savings rates, especially if the Chinese economy has lost a good deal of steam and employment creation?
Hitting on the key points.... China is not unlike the Caribbean.... Where none of the locals can afford to rent a hotel room on their own beaches.... Few Chinese can afford their own products....that THEY manufacture.... Too few people in the room can raise their hand .... Can make... Cannot buy.... ........................................................ So the question becomes what's the number.... To replace the non-Chinese demand that has been lost....how do their numbers have to change....and how can this happen....if their major tool is no longer in the toolbox....?
SHANGHAI - CHINA has told banks to curb loans to steel makers that are increasing production despite falling demand and falling prices, state media reported on Thursday. Beijing issued the order to cut or stop lending to steel producers 'still expanding production capacity without considering actual market demand", the China Securities Journal reported, citing an official notice. The notice, which was not released publicly, also called for banks to curb or cut off loans to mills with outdated technology, the report added. In addition, it told iron ore importers to 'correctly control the volume and pace of iron ore imports in line with the actual demand of domestic steel production'. China, the world's biggest steel producer and consumer, imported 188.5 million tonnes of iron ore in the first four months of the year, up 22.9 per cent from a year earlier, according to customs data. State media reported on Thursday the China Iron and Steel Association planned to investigate surging imports after April iron ore coming into China jumped 33 per cent on year, hitting a monthly record of 57 million tonnes. 'Amid the weakness in the domestic steel market, the imports in April were more than double the normal demand,' the Shanghai Securities News reported, citing Shan Shanghua, secretary general of the industry group. At the end of March, the composite price index of China's steel market was 97.59 points, 31.4 per cent lower than a year earlier, the association said in late April. Overall, domestic steel prices have been falling continuously and are currently lower than 1994 levels. China's demand for steel has seen a mild recovery thanks to relaxed monetary policies and Beijing's economic stimulus plans, but some makers boosted production hoping demand would soon soar again, the reports said. The World Steel Association has forecast China's apparent steel demand is likely to fall five percent in 2009 as the ongoing global economic crisis hits the country's exports. -- AFP http://www.straitstimes.com/Breaking+News/Money/Story/STIStory_376688.html Hum...V Recovery - "Chinese edition"...
its 23%. And even if exports to USA fall by 10% (2% drop of the total exports) that does not mean end of the world for China if they manage to create demand from their own citizens. As I said there is still 700% groth possible until they reach our levels. Of course they have to adopt to the situation that they can no longer rely on the growing demand from outside but I think they will be able to manage that. People who underestimate china have often been proved wrong. They are in a FAR better situation right now compared to USA. You people in USA better get used to the fact that the world will also keep on turning without the help of the US consumer. A world wide portfolio needs some investment in china, get used to it.
Exactly. And the current "published" growth rate of 6.1% (the slowest in 10 years) is barely enough to keep the people in the country from rioting in the streets. Mind you that the nominal GDP for China is calculated on a "year over year" basis, as opposed to an annual rate for each quarter . . . this is much different than here in the U.S. or most other countries that publish their GDP growth figure on a quarter on quarter annualized seasonally adjusted (SAAR) basis.
International shipping indexes are rising and up to the lowest previous levels earlier in the decade. That points to the notion that the world economy is in early recovery, or at least is overreacting less. As we recover, China should recover with more volatility than we do..... we're the dog, they are the tail sort of thing.. Communist places NEVER can grow internal demand or supply for anything, I would not expect that to happen. If it does, then they aren't communists anymore, which, arguably, could be true...