India's Bad Loan Rate Soaring to Near 10% Dwarfs China's

[beijingwalker]

33 trillion dollar chinese loan vs 3 trillion dollar Indian loan...are the Chinese high on weed...our basics are very strong unlike Chinese bubble...

Yes, you are much much smaller in everything comparing to China except for the size of the population. Glad you can see that.

 

[EndangeredSpecies]

The truth is that economists explain that China's debts are also the country's assets cause most of the debts come from companies owned by the government, the government owes itself but not others. China can simply sell the companies and turn the debt into assets. Simply put, you owe your own debt. how big a risk is that?

The whole world owes China money, China also owes money, to herself.

Actually it is not this simple.

When you issue currency, you back it by an IOU. If you buy say a land, using that currency, then that land's value is exchanged for that amount of cash. So on and so forth. Now if you take a loan and start the business, your business and its assets are valued in that currency. And they are backing that currency. If you simply write off the loan, you still have the currency issued which is backing the loan but its underlying value is written off and has no value in it.
What you have done is essentially inflated or devalued your currency. If this happens to a big chunk of your economy, you see hyperinflation. There is curerncy but there is nothing to back it.

This is the reason why you cannot just keep on issuing the loans and creating houses etc without ever closing those loans. You will devalue your currency if you do it for long enough. This is why when there was a stock crash back in early 2016 a lot of value was lost and the currency came into pressure. Chinese government had to spend quite a bit from her forex reserve to keep the currency stable.

So, in nutshell, debt is debt and taking it as 'asset' is going to bite you in your back. sooner or later.

 

[beijingwalker]

They are too brainwashed to realise that mate! Its like pulling a rabbit out of your rear end! Difficult

That's your trick not ours, we do tricks by hard working and efficient governance and management.

 

[EndangeredSpecies]

That's your trick not ours, we do tricks by hard working and efficient governance and management.

Actually China is indeed pulling rabbits out of hat. 2014 slowdown and 2016 crash was because of that. Your overheated real estate and ghost cities are because of that. That one single crash removed about 25% of your forex reserve. 1 Trillion dollar worth.

 

[beijingwalker]

Actually it is not this simple.

When you issue currency, you back it by an IOU. If you buy say a land, using that currency, then that land's value is exchanged for that amount of cash. So on and so forth. Now if you take a loan and start the business, your business and its assets are valued in that currency. And they are backing that currency. If you simply write off the loan, you still have the currency issued which is backing the loan but its underlying value is written off and has no value in it.
What you have done is essentially inflated or devalued your currency. If this happens to a big chunk of your economy, you see hyperinflation. There is curerncy but there is nothing to back it.

This is the reason why you cannot just keep on issuing the loans and creating houses etc without ever closing those loans. You will devalue your currency if you do it for long enough. This is why when there was a stock crash back in early 2016 a lot of value was lost and the currency came into pressure. Chinese government had to spend quite a bit from her forex reserve to keep the currency stable.

So, in nutshell, debt is debt and taking it as 'asset' is going to bite you in your back. sooner or later.

As I mentioned there are economists and experts of all sorts arguing different theories, so called western experts have been predicting China's crash on monthly basis for 4 decades already, welcome Indians to get on this wagon, enjoy your ride.

 

[Beast]

hahahaha Chinese bot's trying to be funny! frustration is growing at an alarming rate, like your debt ceiling and national Gross debt... you really need to introspect before you start pointing fingers.

India is a small fry compared to China, who is a master of economic manipulation

China uncensored? Just like Gordan Chang everyday talking about China collapse for last 20 years.

 

[beijingwalker]

Actually China is indeed pulling rabbits out of hat. 2016 crash was because of that. Your overheated real estate and ghost cities are because of that.

No, your unprecedented demonitization is more like it, we can see how much it helped you, you can do that trick again.

What is 2016 crash by the way..

 

[ashok321]

China regains spot as largest foreign lender to US in June - Gulf Times

While the China is a cash cow, look at last 12 months Indian deficit of 131 billions.

 

[beijingwalker]

Please use the updated chart and figure. here is the updated one, check it out, you are welcome

China's Trillionaire Government Nearly Indestructible
https://www.forbes.com/sites/kenrap...overnment-nearly-indestructible/#10edfe8d7d75

China just keeps getting richer. It's incredible. The central bank increased its holdings by $23.9 billion in four weeks to a total of $3.08 trillion.

What does this mean? It means that the People's Bank of China is armed with enough cash to bail out any failure in a shadow banking lender at the provincial level, and control its currency exchange rate against the dollar.

In just one month's time, the Chinese government through its central bank absorbed enough to money to buy out American toymaker Hasbro, two times over. In fact, in four weeks, the central bank took in enough dollars that if it wanted to, it could buy Hasbro, Macy's and The New York Times based on their market cap, and still have a billion bucks left over.

 

[EndangeredSpecies]

No, your unprecedented demonitization is more like it, we can see how much it helped you, you can do that trick again.

Demonetization was only based on Cash. Its impact is only limited to cash based economy. Your is well... everywhere. It was around 226 billion dollars. And we re-monetized it. You are talking about writing off loans as if nothing.

Please use the updated chart and figure. here is the updated one, check it out, you are welcome
https://www.forbes.com/sites/kenrap...ernment-nearly-indestructible/2/#755c2527758c

Which chart are you talking about?

Forex reserve chart has the latest data. Till now Chinese forex reserves are at around 3.07 trillion, from a high of 4.05 trillion in the beginning of 2014. Thats 25% of your Forex reserve.

What is 2016 crash by the way..

https://en.wikipedia.org/wiki/2015–16_Chinese_stock_market_turbulence

Chinese stock market bubble bursting which started in June 2015 and got really serious in 2016 January. Remember that new year flash sale of stocks?

 

[beijingwalker]

Demonetization was only based on Cash. Its impact is only limited to cash based economy. Your is well... everywhere. It was around 226 billion dollars. And we re-monetized it. You are talking about writing off loans as if nothing.


Which chart are you talking about?

Forex reserve chart has the latest data. Till now Chinese forex reserves are at around 3.07 trillion, from a high of 4.05 trillion in the beginning of 2014.


https://en.wikipedia.org/wiki/2015–16_Chinese_stock_market_turbulence

Chinese stock market bubble bursting which started in June 2015 and got really serious in 2016 January. Remember that new year flash sale of stocks?

Yes, China spent some money worldwide to grab global assets as everyone can see, but still holds one third of world's total foreign reserve, if there's a country brimming with money to a point that it has trouble to spend them, that's China.

How come India's foreign reserve is smaller than Taiwan and Hongkong, that really shocks me.

 

[EndangeredSpecies]

Yes, China spent some money worldwide to grab global assets as everyone can see, but still holds one third of world's total foreign reserve, if there's a country brimming with money to a point that it has trouble to spend them, that's China.

Actually in 2015-16 crash you did buy anything with the forex reserve that were spent. Those monies were spent to ensure that yuan does not depreciate. Basically, traders and corporations were dumping the stocks in Chinese stock market and were trying to take money out of china. So Chinese government had to do two things:
1. Stop the capital outflow, which is still on going.
2. Put money back into the currency so it does not depreciate. Which is where 25% of your forex went.

How come India's foreign reserve is smaller than Taiwan and Hongkong, that really shocks me.

Because India is a smaller economy. Thats why.

 

[beijingwalker]

Actually in 2015-16 crash you did buy anything with the forex reserve that were spent. Those monies were spent to ensure that yuan does not depreciate. Basically, traders and corporations were dumping the stocks in Chinese stock market and were trying to take money out of china. So Chinese government had to do two things:
1. Stop the capital outflow, which is still on going.
2. Put money back into the currency so it does not depreciate. Which is where 25% of your forex went.


Because India is a smaller economy. Thats why.

Get your facts straight, last year China bought so much, google and find it out. Stock markets have ups and downs we don't really feel anything in China like you claimed "crash". China has good professionals and experts mananging this country, your advice is unwanted and you can keep it to yourself and sell it to your Indian government who desperately needs help now.

 

[EndangeredSpecies]

Get your facts straight, last year China bought so much, google and find it out. Stock markets have ups and downs we don't really feel anything in China like you claimed "crash". China has good professionals and experts mananging this country, your advice is unwanted and you can keep it to yourself and sell it to your Indian government who desperately needs help now.

Buying a lot is no excuse for blowing up 25% of your forex in a stock market bubble. Thats like saying I don't care if I lost half of my saving in gamble, I have just bought a lot of imported cars. Does it makes sense? Thats roughly what you are saying.

Oh, btw! Each country has really great economists. Its the closed nature of Chinese government which makes risk to hide and become systemic. Hence when the stock market blows, Chinese government has to open the strings of the purse and ensure that currency does not collapse. Or when the Iron and Steel / Cement overproduction happens, Chinese government has to ensure that it is still soaked in massive ghost towns so that those factories can keep on humming. So on and so forth.

BTW, it is okay to admit that most of this stuff is above your head. No shame in admitting one's ignorance.

 

[karl wang]

Wow, incredible India, again.