China's economic crisis, explained

[StarCraft_ZT]

SOME BITTER TRUTHS:-
1)Chinese economy grew @14% in 2007-08. Now it has come to 7% and moving more downwards.(check the Chinese Finance Minister's recent statements in Google.)

2)There is no prediction how worse it can get.

3) Indian economic growth is underestimated by 15% due to old procedures( Check Credit Swiss's website.)

4) Indian economy grew @5% during FY12-13.( Its worst was over in Q3 of FY 12-13 @4.7%) and it is on an upward move.(6% for FY13-14, 7% for 14-15 and 8%+ from 2015 according to all leading international research centres.)

5) Check the internet and you will not find a single optimistic news on china's economy.

6) Chinese exports are rapidly declining & manufacturing base is eroding. And no consumption story for china.

7) Prediction of World Bank( in 2010) was Indian growth will surpass China's by 2015. It seems that it will come sooner.(Do not mislead by saying that is was predicted to be in 2008 as the Chinese trolls lie on it in PDF)

8) Japan's gdp was $5 trillion in 1995 and in 2013 it is still $% trillion. So. don't get fooled by an upstart move.

I do little research on India economy, is it true that you rely on small and medium companies? If you have the data, can you provide?

 

[Hellraiser007]

Yes, regional government in China have always prefer real estate invesment to raise up GDP figure. Why? According to the tax-sharing system, central government is allocated 60% of taxes revenue while local and regional government is allocated only 40%. Just imagine, 40% revenues to conduct social affairs such as improving minimum wage, providing necessary education to children and subsidiary assistance to public hopital, college and transportation...... regional government has beared so large pressure by using only 40% revenues. While the purpose of fiscal expenditure from central government is never questioned and the the expenditure is approved, executed and monitered all by central government without segregation of dutie. So we cannot guarantee the appropriate use of cenral government expenditure to the right place. But india does not have a better situation than China in this area.

During the last a few years, China's steel and other building material industries have experience excess production capacity which cannot be consumed in the short term because government has banned access to high energy consumption and low productive natraul resources companies. But we will still carry on infrastructure construction becasue we have to consume the excess production.

Actually, we are transforming from a investment & export oriented economy to an endogenous growth with domestically innovated products, consumption and service industry.

What you say about inter-bank lending rate is true, I work in the bank, so I am very familiar with the situation.

Most of the money was lended to regional government to launch construction project and real estate project while they did not even seriously consider the real consuming power of people. Many of the road and real estate cannot bring a steady cash flow. No return, no revenue from excessive construction projects so regional government will bankrupt while central government have to pay the final bills for them. Many banks are experincing Money Shortage, so the interbank exchange rate rise to such high level. One of the bank even provide a free mac air book to attract deposit of yuan equals $ 100,000 USD.

Our PM Li Keqiang have determined to reform this area by forbidding Central Bank‘s Reverse-Repurchase Agreement which is a sign to support liquidity shrinkage. Because Li Keqiang insist to activite the currency in circulation while strictly control new currency into market, which will keep down the inflation rate and ease the pressure of regional government and banks. I am quite optimistic with his policies.

Nicely explained the the current scenario, The problems are due to the transformation of Chinese economy and it is a test for Chinese leaders.

 

[Psyops]

Indian economy is collapsing and Indians are laughing at China. You can't make this sh*t up

India has one of the worst performing currencies in the world, even Greece is doing better than India. India had to go into deficits to get their growth, but debt levels are too high and the currency has collapsed. To deal with the collapsed currency, they are forced to reduce their deficits, but that means their growth has been reduced significantly because their economy is based on how long they could afford to run deficits. As all Ponzi schemes come to an end, Indian Ponzi scheme has come to an end.

Indian rupee will be at 100 by the end of the year, bookmark it.

 

[HongWu]

Indian rupee has completely collapsed to 70:1 against the dollar. Meanwhile Chinese yuan is at an all time high of 6:1 against the dollar.

India is getting poorer and poorer. They are feeling so inferior