Posts Tagged ‘china economy’

China’s Economic Growth Slows To Lowest Level Since 1990

January 20th, 2015 Comments off

China’s National Bureau of Statistics released GDP growth figures for 2014, indicating that the world’s second largest economy grew that year by 7.4 percent (, below the planned rate of 7.5 percent but exceeding expectations of 7.2 percent. Even if the figures released by Beijing’s NBS are accurate, they reflect a continuing trend of diminishing rates of growth over the past several years, and are the lowest level of GDP growth in 24 years.

But are the official figures on China’s GDP growth believable? Many elements of China’s macroeconomic performance are shrouded in opacity. The architecture of this vast economy  is formulated from a fundamentally contradictory hybrid mix of private sector capitalism and still overwhelming and largely inefficient state controlled sector, especially in heavy industry. Much of China’s growth in the past, impressive as it seems by overall world standards, was based on massive government spending on underutilized infrastructure; the accounts of entire blocks of apartment buildings that remain unoccupied are well known. There are the dangerous property bubbles, early signs of deflation, and rising debt levels in both the public and private arenas, with growing signs of a future explosion in bad debts held by Chinese financial institutions.

Officially, China’s leadership has resorted to what they call the “new normal,” a more sustainable rate of economic growth. The reality is likely a lot more murkier and volatile than the official statistics and pronouncements would indicate.

The clear trend of diminishing rates of GDP growth in China, whether extrapolated from official figures or derived from a more nuanced assessments of China’s economic performance, are already having an effect on the entire global economy. As with the United States, the massive size of the Chinese economy means that lower GDP growth rates create a head wind for the global economy as a whole. It is therefore no surprise that the International Monetary Fund has just revised its forecast of global economic growth downward by the most substantial margin in three years, to 3.5 percent from the 3.8 percent projected only  three months ago by the IMF ( This is a harbinger of what lies in store for the global economy as the formerly massive rates of Chinese economic expansion continue to recede.


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Hillary Clinton Nude


China Economic Growth Is Stagnating

January 23rd, 2014 Comments off

According to China’s National Bureau of Statistics, the nation’s GDP in 2013 grew by 7.7 percent over the prior year, beating the original forecast of 7.5 percent, albeit by a small margin. On the surface, this is an impressive performance that the U.S. and Eurozone can only dream of emulating. However, a caveat is always required in assessing official Chinese economic data. Not only is Beijing suspect and at times manipulative in compiling the nation’s economic statistics (as are many other countries), it must be remembered that China’s GDP growth is seeded with massive borrowing by local governments, which in turn invest in vast infrastructure projects, which often have little real economic utility, such as uninhabited housing projects.

The truly important news with the 2013 GDP numbers from China is that they represent a marked slowdown in economic growth, when relying on just official government economic data. The current level of GDP growth is far removed from the brighter days when China achieved double digit growth year after year, for a decade or more. It is clear that China’s remarkable economic growth is slowing down, and that could be a preview for a period of much higher unemployment with concomitant political instability.



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Hillary Clinton Nude


Hillary Clinton Nude


Hillary Clinton Nude





China Economic Slowdown

July 18th, 2013 Comments off

Official figures from Beijing indicate  that the Chinese economy grew by 7.5 percent in Q2 of 2013. In a developed economy, that would be considered stellar growth. In China, however, where economic dynamics (and economic data transparency) functions acutely different from a typical advanced economy, this number is alarming. It represents a sharp contraction in growth,  far removed from the sweet days prior to the onset of the global economic crisis, when annual growth rates routinely exceeded 10 percent.

China’s economic model was based on export led growth, facilitated by low labor costs. As recession-plagued Europe, in particular, can no longer sustain a growth in exports from China, fiscal and monetary stimulus is substituting in an effort to extract some level of expansion in China’s economy. What is in fact occurring is the proliferation of massive bubbles, particularly in real estate. Much of the GDP growth  in China is based on industrial, commercial and especially residential real estate construction funded by easy credit. The number of unoccupied homes and office complexes is rising, leaving China’s economy vulnerable to massive bubble implosions on the level that afflicted the U.S. property market in 2007.

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Hillary Clinton Nude


Hillary Clinton Nude


To view the official trailer YouTube video for “Wall Street Kills,” click image below:

In a world dominated by high finance, how far would Wall Streetgo in search of profits? In Sheldon Filger’s terrifying novel about money, sex and murder, Wall Street has no limits. “Wall Street Kills” is the ultimate thriller about greed gone mad. Read “Wall Street Kills” and blow your mind.

Why China’s Premier Wen Jiabao Is “Worried” Over Eurozone Debt Crisis

August 31st, 2012 Comments off
If Chinese Premier Wen Jiabao is concerned about the Eurozone debt crisis, than it is a signal for just about every other major economy to start sweating bullets. This is what the head of the Chinese government said just recently: “The European debt crisis has continued to worsen, giving rise to serious concerns in the international community. Frankly speaking, I am also worried.”

Note that Wen Jiabao’s assessment is that the Eurozone debt crisis continues to get worse. Obviously, the world’s second largest economy has no confidence in the numerous measures and bailouts enacted to date by the Eurozone’s coterie of inept politicians. That Beijing has arrived at such a conclusion regarding economic and fiscal policymaking in Europe is as clear a sign as any that the political class in the European monetary union has failed abjectly in restoring market confidence amongst those actors most critical for Europe, namely China’s ruling elites.

Wen Jiabao goes on to say, “The main worries are two-fold; first is whether Greece will leave the Eurozone. The second is whether Italy and Spain will take comprehensive rescue measures. Resolving these two problems rests with whether Greece, Spain, Italy and other countries have the determination for reform.”

Reading between the lines, it would appear that China’s ruling circles are terrified at what is unfolding in Europe, and are as uncertain as everybody else regarding their future trajectory. They have good reasons for worrying. The Eurozone is a critical trade destination for China’s exports. At a time when artificially stimulated growth is beginning to wane in China, a sharp drop in exports to Europe would have disastrous consequences, economically and politically, for Beijing. It would appear that China’s leadership is hoping, perhaps even praying, that the core economies in the Eurozone, especially Germany, will undertake far more radical measures than implemented to date, in the hope that the entire monetary union will not unwind.

What must be going through the collective minds of China’s ruling Communist Party is that if the Eurozone comes apart, resulting in the spread of financial and economic chaos across the globe, the chickens will come home to roost on China’s shores, leading to political instability and unrest that threatens the Chinese Communist Party’s monopoly on political power. Indeed, Premier Wen Jiabao has a great deal to worry about, and so do his colleagues in China’s ruling Politburo.




 To view the official trailer YouTube video for “Wall Street Kills,” click image below:

In a world dominated by high finance, how far would Wall Street go in search of profits? In Sheldon Filger’s terrifying novel about money, sex and murder, Wall Street has no limits. “Wall Street Kills” is the ultimate thriller about greed gone mad. Read “Wall Street Kills” and blow your mind.





China’s Hard Economic Landing Appears Imminent

August 1st, 2012 Comments off

As a percentage of GDP, China’s economic stimulus program of 2009 was the largest in the world, and second place to the U.S. in monetary terms. Ironically, the supposedly communist economy of the People’s Republic of China became the last best hope of world capitalism, in the wake of the global financial and economic crisis that began in 2008. Now, it appears, things may be unwinding in a bad way for Beijing.

Copying its capitalist rivals, Beijing’s hybrid government/private economy poured massive amounts of cash into creating new asset bubbles, particularly in real estate. China built shopping malls with no customers, cities with no inhabitants and roads with no traffic. Extravagantly redundant infrastructure was constructed with stimulus money, goosing China’s GDP with annual double digit growth rates. This model was clearly unsustainable; China’s leaders were hoping to buy time so that the nation’s major export markets in Europe and the U.S. would recover with their own stimulus programs, and resume  their buying spree of cheap Chinese goods.

“Kick the can down the road” became the official credo of economic policymakers responding to the global economic crisis. As with other economies pursuing this shortsighted policy prescription, China failed to address the fundamentals of its economic challenge. The proportion of domestic consumption as a share of  GDP in China is less than half the ratio of its customers in the developed world. With its economic ascendancy dependant on overseas customers, the stagnation and contraction of the economies of those customers leaves a void that Beijing cannot cover by building the economic version of sand castles.

With the Eurozone tottering on the edge of the abyss, the U.K. mired in recession and the U.S. growth rate so anemic, even with trillion dollar plus annual deficits, that it is now at stall speed, it appears that the policymakers in Beijing may have lost their stimulus spending bet.  Domestically, the Chinese PMI  (Purchasing Managers Index)  has slumped to the lowest level in eight months. Other indicators, even amid the opaqueness of China’s official economic data, point increasingly towards a hard economic landing  for the world’s second largest economy. The consequences will be dire, not only for  China, but also for the global economy as a whole.




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Sex, murder, financial power and pathological greed come together in the explosive suspense thriller by Sheldon Filger, WALL STREET KILLS: A NOVEL ABOUT FINANCIAL POWER, VIOLENT SEX AND THE ULTIMATE SNUFF MOVIE.
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China’s Exports Plunge

August 12th, 2009 Comments off

The world’s third largest economy is sending worrying signals to those whose best hopes for an end to the Global Economic Crisis reside with China. Though Chinese growth projections seems spectacular in a recessionary world, with estimates ranging from 8% to above 9%, there is both more and less to these numbers than meets the eye.

The superstructure underlying China’s impressive growth rate over the past decade and more has been exports, especially to the American consumer, with facilitation from credit flows emanating from Beijing. In a situation where the central government is priming the stimulus pump, growth is being artificially created to a large extent, since domestic demand cannot compensate for China’s ravaged export markets. Factories may still be manufacturing export goods, however, the inventories are surging while shipments abroad are contracting. That appears to be the message revealed in new figures on China’s economic performance.

According to China’s  customs bureau, exports in July declined a staggering  23% from a year ago. This number is apocalyptic, yet on paper China’s GDP keeps soaring. How can an export driven mega-economy experience significant growth simultaneously with its core export sector undergoing a free fall contraction? By flooding the economy with liquidity through  monetary easing, it would appear. However, this is not a recipe for long-term, sustained growth. This policy will only succeed if there is a rapid turnaround in China’s export trade. That is a dim prospect, in light of the continuing decline in employment numbers in most of China’s key export markets, especially the United States and the Eurozone.

Another  revealing statistic to emerge from Beijing involves lending. The first 6 months of 2009 involved a floodtide of easy credit saturating  the Chinese economy. However, in July new loans declined by a massive three quarters from the prior month. It seems policymakers in China are getting more concerned about  the prospect that overly-loose credit will fuel an asset bubble in Chinese equities and real estate, while leading to an increase in loan defaults in the future.

Taken together, we see China engaged in a a series of massive interventions and policy actions in response to the Global Economic Crisis that are not dissimilar from other major economies. These steps are predicated on the hope that massive pump priming will keep the economy from imploding until there is a global recovery, enabling China’s export trade to resume its upward trajectory.

In my view, despite the rosy growth projections, the underlying fundamentals of China’s economy are based on fragile assumptions. If demand for China’s export goods from overseas consumers remains far under peak demand levels for a sustained period, Beijing will confront this reality: the nation’s massive export manufacturing infrastructure cannot indefinitely employ workers who fabricate products that pile up on the docks of China’s major ports. That is the nightmare scenario China’s leadership circles pray never unfolds.


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Scary Data From China And The UK As Global Economic Crisis Worsens

January 24th, 2009 Comments off

While politicians have ceased denying what cannot be denied, that the world is enduring a crippling global financial and economic crisis, they still largely inhabit the land of make believe. What is more, they beckon their fellow citizens to enter blindly into their Alice in Wonderland construct for global economic salvation. Never mind that loose monetary policies enacted by central banks and massive deficit spending sustained by political actors lubricated the skids of this global economic disaster, we must accept on faith the prescription of the political establishment; even more public debt, compounded by near-zero interest central bank rates.

The latest macroeconomic data that has emerged from China and the UK should pour a bucket of cold water over even those most tolerant of political smoke-and-mirrors disguising itself as economic salvation. To say that the numbers were dismal would be an extreme understatement. Perhaps more poignantly, they are further markers on the highway to acute global economic meltdown.

China has for a decade been the primary engine of global economic growth. By becoming the factory for much of the consuming world, it accumulated huge savings, this cash pool being used to loan money to the United States, its major customer by a wide margin. As long as Americans bought Chinese products and kept the factory floors from Shanghai to Canton buzzing with full employment, the bosses in Beijing were quite content buying U.S. Treasury bills by the hundreds of billions of dollars. Now that consumer demand in the U.S. is contracting, however, along with other major markets, China will likely need to shift its accumulated savings towards financing its own deficit spending, as opposed to Washington’s stimulus credit needs. The official results for the 4th quarter GDP show a drastic reduction in growth, pointing to a sharp downturn in the Chinese economy.

A 4th quarter result of 6.8 % growth would seem like manna from heaven in comparison with other major economies. However, in the context of China’s massive labor pool this number is problematic, as double-digit growth has been essential for maintaining a level of employment satisfactory for sustaining social cohesion. Economist Nouriel Roubini points out, however, that this number is misleading. He believes that the Q4 in China brought no growth, perhaps even the beginnings of negative growth. Signs point to a recession in China during 2009, with disastrous consequences for the global economy.

The boom in the past decade in the Chinese economy also fueled economic expansion in much of Southeast Asia. Enterprises in South Korea, Taiwan, Thailand and Singapore, as well as other Southeast Asian nations, provided raw materials, products and services that were incorporated into the output of China’s vast economy. Contraction in China will be devastating to the economies on her periphery, while also diminishing her appetite to lend increasingly scarce savings to finance the profligacy of the U.S. federal budget.

In the UK, the 4th quarter GDP numbers, revealing a decline of 1.5%, magnified the apocalyptic news that has emerged from the carcass of its banking sector. As this is the second consecutive quarter of negative GDP growth in the UK, that country is now technically in a recession, hardly a startling revelation for the beleaguered British taxpayers. As with America, the political establishment offers only more tax-funded bailouts, even more massive deficit spending, garnished with historically low Bank of England fund rates.

In addition to the appalling quantitative data emerging from China and the UK, there is one other barometer of the cascading Global Economic Crisis, the obscure Baltic Dry Exchange Rate. In simple terms this is a measure of the cost of shipping raw materials to China by freighter. When the Chinese economy was humming, the demand for shipping dictated a high rate. That is now history; as the Baltic rate is sinking like a broken old rusty ship, reflecting collapsing demand by China for raw materials, as its factories shutter their doors. In essence, the current anemic Baltic rate attests to a process of virtual de-industrialization occurring on the planet on a titanic scale.

Though China and the UK have different economic characteristics and dynamics, they are both significant actors, along with the United States, in the global drama that is now unfolding. The examples I have sited are just another dose of empirical data pointing to the year 2009 as being one of economic extremis.