China's real economy is better than ever

[Brickwall]

Indian participation often reduces the quality of a thread. Therefore, it is always advisable to ignore them (except very few reasonable ones).

Chinese members must be thinking we are wishing for destruction of chinese economic miracle, but rest assured every indians is inspired by chinese growth story, and we keep on prodding our government to follow the same.

Only thing we are worried, if chinese economy hard lands, it will have huge impact on india, and we certainly dont want any distraction when indian growth story about to start.we require stable chinese economy for india to grow infact world to grow.

 

[ahtan_china]

Chinese members must be thinking we are wishing for destruction of chinese economic miracle, but rest assured every indians is inspired by chinese growth story, and we keep on prodding our government to follow the same.

India dream!

 

[Shotgunner51]

I have also listen that total debt risen to 250% of your gdp...is that true?that means your economy will go like american way?

Do you mean external debt? No then, China is a creditor nation, just mainland alone is #2 largest in the world after Japan (which has been #1 in the world for last 23 years) as per latest reports, followed by Germany, Taiwan, Switzerland, Hong Kong. Check Net International Investment Position (NIIP) data. Note if all China combined, i.e. Mainland + HK + Taiwan + Macau, then already is world #1 creditor nation.

US is the world's #1 largest debtor nation, no surprise! Followed by the likes of Spain, Brazil, Australia, India, UK, France, Italy, Mexico, Turkey, Poland, Greece, etc.

List of creditor nations by net international investment position per capita - Wikipedia, the free encyclopedia
List of debtor nations by net international investment position per capita - Wikipedia, the free encyclopedia

 

[IN-2030]

Do you mean external debt? No then, China is a creditor nation, just mainland alone is #2 largest in the world after Japan (which has been #1 in the world for last 23 years) as per latest reports, followed by Germany, Taiwan, Switzerland, Hong Kong. Check Net International Investment Position (NIIP) data. Note if all China combined, i.e. Mainland + HK + Taiwan + Macau, then already is world #1 creditor nation.

US is the world's #1 largest debtor nation, not much surprise. Followed by Spain, Brazil, Australia, India, UK, France, Italy, Mexico, Turkey, Poland, Greece.

List of creditor nations by net international investment position per capita - Wikipedia, the free encyclopedia
List of debtor nations by net international investment position per capita - Wikipedia, the free encyclopedia

NO...I am pointing out internal debt which risen to 207% of gdp
China's Debt-to-GDP Ratio Just Climbed to a Record High - Bloomberg Business

 

[empirefighter]

Chinese members must be thinking we are wishing for destruction of chinese economic miracle, but rest assured every indians is inspired by chinese growth story, and we keep on prodding our government to follow the same.
.

Chinese members must be thinking....rest assured......... Sigh，why India people so confident？ You REALLY dream too much，no Chinese is interested in comparing with India，so no one cares how India think of our economy，India economy is still far behind ，specially the industrial capability is too weak.
The Chineses donot care small but rich countries since they are lack of industry capability too，we care how to develop and upgrade our industry，USA ，Japan and Germany is our focus，sometimes SK included. We care India when refering to politics，trust me，you think is not the same with us.

 

[Shotgunner51]

NO...I am pointing out internal debt which risen to 207% of gdp
China's Debt-to-GDP Ratio Just Climbed to a Record High - Bloomberg Business

I have read the article, very impressed though in a unusual manner.

First of all it's debt loaned to companies and individuals, we have a term for it "Domestic Credit To Private Sector". Note it is not "Public Debt", which usually has to be managed vs GDP or Tax Revenue, and you can dig deeper in this agenda, in China's case it's well under control. Check below link or other open sources.

China Government Debt to GDP | 1995-2015 | Data | Chart | Calendar​

About significant increase in domestic credit to private sector, it's a lot more complicated as usual:

• It's driven by even faster growing M1/M2 money supply (货币供应) for the period 2008-2015, i.e. quantitative easing (check US for the same period).
• Also, the huge trade surpluses in form of forex, and inbound FDI, sold to PBOC further increase money supply. This compulsory buying is a policy (强制结汇).
• RMB appreciation expectation (人民币升值预期) brought in hot money.
  
• Note, alot of credits go into infrastructure/CAPEX of long pay-back period (回本期), check China's massive addition of infrastructures since 2008. The overall scale is not a problem, the credits are hedged by ever expanding assets.
• It's a good news to the vibrant small-to-medium POE which have been sidelined by SOE before.
• China has been developing the bond market gradually. The most developed markets are US, HKSAR (233%), UK, Singapore (132%), etc. Shanghai is developing fast.
  
• If you still want a comparison vs GDP, check some benchmarks from World Bank:

Domestic credit to private sector (% of GDP) | Data | Table​

I am impressed by financial knowledge (or the lack of it) of Bloomberg's readership. After reading the article, I will be glad to see Bloomberg advising US on strategic economic/fiscal policy.

 

[zeronet]

Indian economy is based on domestic consumption not export centric...Indian economy size is $2.3 trillion where as export size is just $300 billion.Reduction in export in terms of dollor is mainly due to reduction in crude oil and other commodity prices,,as India export huge refined petroleum product and other minerals.
As far as electricity consumption is concern it shows how industry is growing...china's electricity consumption is greater than USA(per capita is still 1/4th) because chinese economy has more share of industry than service sector.Same goes for freight traffic.Also real state sector contribute 8-10% to your economy but demand is slowing as it is already builded over-capacity.
I have also listen that total debt risen to 250% of your gdp...is that true?that means your economy will go like american way?

Indian's export account for 14.6% of GDP in 2014, while China's data is 22.5%. For 1st half yr in 2015, indian export down 15% in his 14.6% part economy, is equivalent to a 9.7% down in 22.5% part of his economy. you see when normalized to the Chinese level of export, how hard Indians have to compensate in their rest part of economy in order to achieve their claiming growth rate, much harder than China, whose export got 0.7% down in the 1st half yr. The above estimate is not accurate since export is not equivalent to GDP, but still you can have a rough sense.

Chinese economy structure is way different from that of USA and other developed economies, for China's service industry accounts far less in the overall economy, even less than India's. That also means great growth potential. And service industry is easier to grow compared to physical goods production, where you have to face international competitions. Most of the service, on the other hand, is just domestic oriented. When the global economy is slowing down, it is time to shut down some unwanted, polluted businesses. It is painful, but for China, hey you cannot always consume more than half of world's coal, and produce more than half of world's steel and cement while have only 16% of global population. It is unusual. China is finishing its first stage development, aka industrialization, and is entering more advanced stage. India is trying to enter the industrialization stage with doubts. At least the newspaper "the Economist" doesn't think India will success. Look at your huge trade deficit, and your tiny goods production/export, it cannot be improved only by slogan "make in india"

 

[Shotgunner51]

Indian's export account for 14.6% of GDP in 2014, while China's data is 22.5%. For 1st half yr in 2015, indian export down 15% in his 14.6% part economy, is equivalent to a 9.7% down in 22.5% part of his economy. you see when normalized to the Chinese level of export, how hard Indians have to compensate in their other part of economy in order to achieve their claiming growth rate, much harder than China, whose export got 0.7% down in the 1st half yr. The above estimate is not accurate since export is not equivalent to GDP, but still you can have a rough sense.

Chinese economy structure is way different from that of USA and other developed economies, for China's service industry accounts far less in the overall economy, even less than India's. That also means great growth potential. And service industry is easier to grow compared to physical goods production, where you have to face international competitions. Most of the service, on the other hand, is just domestic oriented. When the global economy is slowing down, it is time to shut down some unwanted, polluted businesses. It is painful, but for China, hey you cannot always consume more than half of world's coal, and produce more than half of world's steel and cement while have only 16% of global population. It is unusual. China is finishing its first stage development, aka industrialization, and is entering more advanced stage. India is trying to enter the industrialization stage with doubts. At least the newspaper "the Economist" doesn't think India will success. Look at your huge trade deficit, and your tiny goods production/export, it cannot be improved only by slogan "make in india"

Good points made bro! Well let's not reduce the quality of analysis using india as comparison, which is just a poor/backward agrarian country, even outlook is pessimistic due to poor natural/human resources.

As core of Market Reform 1.0, top priority for mainland China now is still real economy i.e. industrialization. By now China has world's biggest, full-spectrum, industrial base. Moving forward, like @empirefighter says, the competitors now are hi-value-adding industrial powers like Japan (machine, robotics), Germany (machine, pharmaceutical), SK (electronics, heavy industry) and Taiwan Province (machine, electronics). As a foundation for real economy to grow, mainland China will continue to invest in hard infra, which by now has taken good shape after decades of building especially along the vast Eastern seaboard.

“Dear President, how can we help your country?” - AIIB​

Market Reform 2.0 in civil protection, in finance sector, are gradually picking speed. The target is to boost general wealthiness, and turn the huge & ever-expanding domestic savings into consumption. Business hubs in mainland China should begin to gauge against HKSAR (civil infra, finance), Singapore (civil infra, finance) & Switzerland (civil infra, finance).

BCG: $$$ Millionaires In China Increased By 49% YOY
Top 10 Cities for World's Millionaires (US$)​

 

[TaiShang]

I have read the article, very impressed though in a unusual manner.

First of all it's debt loaned by companies and individuals, we have a term for it "Domestic Credit To Private Sector". Note it is not "Public Debt", which usually has to be managed vs GDP or Tax Revenue, and you can dig deeper in this agenda, in China's case it's well under control. Check below link or other open sources.

China Government Debt to GDP | 1995-2015 | Data | Chart | Calendar​

About significant increase in domestic credit to private sector, it's a lot more complicated as usual:

• It's driven by even faster growing M1/M2 money supply for the period 2008-2015, i.e. quantitative easing (check US for the same period).
• Also, the huge trade surpluses in form of forex, and inbound FDI, sold to PBOC further increase money supply.
• RMB appreciation expectation brought in hot money.
  
• Note, alot of credits go into infrastructure/CAPEX of long pay-back period, check China's massive addition of infrastructures since 2008. The overall scale is not a problem, the credits are hedged by ever expanding assets.
• It's a good news to the vibrant small-to-medium POE which have been sidelined by SOE before.
• China has been developing the bond market gradually. The most developed markets are US, HKSAR, UK, Singapore, etc. Shanghai is developing fast.
  
• If you still want a comparison vs GDP, check some benchmarks from World Bank:

Domestic credit to private sector (% of GDP) | Data | Table​

I am impressed by financial knowledge (or the lack of it) of Bloomberg's readership. After reading the article, I will be glad to see Bloomberg advising US on strategic economic/fiscal policy.

Indian's export account for 14.6% of GDP in 2014, while China's data is 22.5%. For 1st half yr in 2015, indian export down 15% in his 14.6% part economy, is equivalent to a 9.7% down in 22.5% part of his economy. you see when normalized to the Chinese level of export, how hard Indians have to compensate in their rest part of economy in order to achieve their claiming growth rate, much harder than China, whose export got 0.7% down in the 1st half yr. The above estimate is not accurate since export is not equivalent to GDP, but still you can have a rough sense.

Chinese economy structure is way different from that of USA and other developed economies, for China's service industry accounts far less in the overall economy, even less than India's. That also means great growth potential. And service industry is easier to grow compared to physical goods production, where you have to face international competitions. Most of the service, on the other hand, is just domestic oriented. When the global economy is slowing down, it is time to shut down some unwanted, polluted businesses. It is painful, but for China, hey you cannot always consume more than half of world's coal, and produce more than half of world's steel and cement while have only 16% of global population. It is unusual. China is finishing its first stage development, aka industrialization, and is entering more advanced stage. India is trying to enter the industrialization stage with doubts. At least the newspaper "the Economist" doesn't think India will success. Look at your huge trade deficit, and your tiny goods production/export, it cannot be improved only by slogan "make in india"

Excellent critical and constructive analyses, bros!

Thank you!

@Chinese-Dragon

 

[liall]

I do not think any one of you are an economist or anything. Some kids whining over internet with some bull shit. China's economy isnt as good as is being painted over here otherwise why would it be even brought up. China had a real growth for last couple of decades and now it is slowing down a bit. Nothing unnatural over here. Time to move on.

 

[+4vsgorillas-Apebane]

Good points made bro! Well let's not reduce the quality of analysis using india as comparison, which is just a poor/backward agrarian country, even outlook is pessimistic due to poor natural/human resources.

As core of Market Reform 1.0, top priority for mainland China now is still real economy i.e. industrialization. By now China has world's biggest, full-spectrum, industrial base. Moving forward, like @empirefighter says, the competitors now are hi-value-adding industrial powers like Japan (machine, robotics), Germany (machine, pharmaceutical), SK (electronics, heavy industry) and Taiwan Province (machine, electronics). As a foundation for real economy to grow, mainland China will continue to invest in hard infra, which by now has taken good shape after decades of building especially along the vast Eastern seaboard.

“Dear President, how can we help your country?” - AIIB​

Market Reform 2.0 in civil protection, in finance sector, are gradually picking speed. The target is to boost general wealthiness, and turn the huge & ever-expanding domestic savings into consumption. Business hubs in mainland China should begin to gauge against HKSAR (civil infra, finance), Singapore (civil infra, finance) & Switzerland (civil infra, finance).

BCG: $$$ Millionaires In China Increased By 49% YOY
Top 10 Cities for World's Millionaires (US$)​

Good points bro, your posts are always really well thought out.

People are going to call me a fcuker for mentioning this but I have been of the opinion that one reform that is really needed but overlooked is reform of character, ie reform of peoples way of thinking, acting, goals and behaviour.

30 years of break neck economic growth has led to a massive lag in social behavioral progress and quality of character. People are becoming too shallow, too materialistic and in some cases, very badly behaved. Like the newly rich, their mental cultivation has yet to catch up with their newly acquired wealth.

What is now needed is education in manners, environmental accountability, driving habits, cultivation of Confucian virtues and priorty of material purchases (parents health before sports car etc).

Good people makes a strong country.

 

[Jlaw]

when My politics teacher talk about Chinese stock market in class two years ago (when i was a student of ten grades),he told us chinese stock market is different from foreign.becasuse our stock market can not relect real situation of economy...
it is seems that a lot of foreigners do not know this...
btw...i guess these people who predict china will collapse might feel unhappy again...

Same thing with US and Canadian stock market. IT doesn't really reflect the true economy. Stock market is just a "moral" way for gambling your money.

Do you mean external debt? No then, China is a creditor nation, just mainland alone is #2 largest in the world after Japan (which has been #1 in the world for last 23 years) as per latest reports, followed by Germany, Taiwan, Switzerland, Hong Kong. Check Net International Investment Position (NIIP) data. Note if all China combined, i.e. Mainland + HK + Taiwan + Macau, then already is world #1 creditor nation.

US is the world's #1 largest debtor nation, no surprise! Followed by the likes of Spain, Brazil, Australia, India, UK, France, Italy, Mexico, Turkey, Poland, Greece, etc.

List of creditor nations by net international investment position per capita - Wikipedia, the free encyclopedia
List of debtor nations by net international investment position per capita - Wikipedia, the free encyclopedia

I think Satya is confused with China and Japan. The 250% GDP to debt ratio is Japan.

IMF warns of higher debt-GDP ratio in Japan | The Japan Times

"In its latest Fiscal Monitor report, the IMF also revised up its near-term projections for Japan’s debt-to-GDP ratio, to 246.1 percent in 2015 and 247.0 percent in 2016, up by 0.7 percentage"

India will be an IT power in 2012. You will see that.



Indian economy is a large Modi scheme.

India was a large IT power but losing its grip to Philippines

India losing 70% voice and call centre business to Philippines: report - NDTVProfit.com

 

[TaiShang]

India was a large IT power but losing its grip to Philippines

India losing 70% voice and call centre business to Philippines: report - NDTVProfit.com

India has to find other innovative industry, then. Garment making?

 

[CAPRICORN-88]

I do not think any one of you are an economist or anything. Some kids whining over internet with some bull shit. China's economy isnt as good as is being painted over here otherwise why would it be even brought up. China had a real growth for last couple of decades and now it is slowing down a bit. Nothing unnatural over here. Time to move on.

One needs not be be a rocket scientist to figure that out.

What is the size of China's automobile market in comparison to India?

With approx. the same growth rate as China today but only approx. 1/5 the size of China economy, I keep trying to figure out how your brilliant economists could concluded that India will overtake China.

I like to watch India movies sometimes because the Indian producers knows their cinema-goers very well. Apart from the hips swaying routines, they also added lot and lot of inspiring moving scenes that propel the fans to a make believe world of fantasy as well as comedians.

Not a bad idea and the masses mind needed to be feed.

 

[Jlaw]

India has to find other innovative industry, then. Garment making?

No, some lower end garment makers will be going to SEA. Textile maybe a low paying industry but it is a high margin industry as a final product.