18 May 2012

Potemkin China: Struggling to Discover Its True Self

When I think about an economic black box China is the economy that comes to mind. This video from Reuters shows a Chinese economist snooping around Chinese ports and commercial areas looking for clues on the ground. What did he find? An economy that looks a lot slower than the one reported by the Chinese government. Some people claim to understand what’s going on in China, but given the many inconsistencies I just don’t see how anyone can claim to be an expert. After all, even Chinese economists feel the need to investigate their own economy…. _PragCap


We already knew that the CCP government had a tendency to shade the truth to fit the approved narrative. But deeper undercurrents of turmoil are taking place inside of China, with more troubling implications. China's government is undergoing an identity crisis, an internal power struggle.
there are political sides in the communist state of China. Here, it's a matter of the right and the left. In China, it's a matter of private enterprise and strong foreign investment versus highly centralized and debt-heavy state enterprise.

According to the geopolitical analysis company Stratfor, the left may be losing ground in China, and Beijing may be headed down an economic path that focuses on private enterprise. _Mauldin

Stratfor is being a bit premature in its prognosis, according to Al Fin Global Analysts Ltd. Chinese security and defense forces are populated by persons with the old collectivist mentality. The struggle has just begun. China's transition to a new government elite may have to be postponed until 2013 as a result.

Interesting times.

More: Michael Pettis predicts collapse in China's investment growth rate

China's huge commodities stockpiles suggest a darker future for national and world economies

No nation can be permanently immunised from the laws of economics.

Even more (20May2012):

China biggest threat to global economy

Heavy hand of CCP on China's economy threatens China's economic future


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Blogger neil craig said...

"even Chinese economists feel the need to investigate their own economy"

Quite right too. I would hope there are a few American economists investigating the american economy.

China's energy production continues to rise at at least 10% a year and the corelation between GNP & energy use is undisputed. A point for American economists to note.

Monday, 21 May, 2012  
Blogger mopc said...

Why is this blog so morbidly obsessed with predicting the doom of China? Maybe because of a wrong belief that China is "communist" "centrally planned"? It's not. It's a mixed economy like most countries. Gee you seem like one of those enviro-doomers and peak-oilers, always cheering for catastrophe, only exaggerating negative sides and ignoring positive signs. China may face a bubble-burst soon but then it will recover and become the largest economy on Earth well before 2025. It simply has too much potential, too high an IQ and too many people.

Tuesday, 22 May, 2012  

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“During times of universal deceit, telling the truth becomes a revolutionary act” _George Orwell

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