China to build apartments on moon!

By David Llewellyn-Smith

From me this morning:

China yesterday unveiled a $400 trillion yuan ($60 trillion) stimulus package that aims to put empty apartments on the moon. Dubbed a “maxi-me” of the stimulus package unveiled in 2008 to combat the initial hit from the global financial crisis, the program includes dead end infrastructure and ghost cities across the Sea of Tranquility. China has no plans to fill the cities with people.

The package is 100 times greater in size than the 2009 junket and is the equivalent of one year’s global GDP. It will be financed with the willing participation of the nation’s largest banks, which can see profits far out into empty space.

News of the venture helped lift regional stock markets yesterday.

This is good news for Australia’s mining sector, which has seen orders delayed and cancelled from its biggest market along with plummeting share values. It is estimated that moon construction could absorb as much as the top three metres of soil across Western Australia, lowering that state below the rest of the continent and easing the journey for eastern states unemployed as they roll to the Pilbara for work.

I could go on and why not? There is little to prevent it. Standards? Phewy! Truth? Bah! Some vague sense of professionalism? Nah!

That seems to be the attitude of both the Australian Financial Review (AFR) and The Australian who yesterday breathlessly reported a not that dissimilar $300 billion new stimulus package in China, even though no such “package” exists. It began with the AFR and was followed up by The Australian whose source for China news appears to be…the AFR.

Just why both papers did so I have no idea but it does seem to be revealing about where we are at, economically. Sell ’em dirt and slap the backs of those that do. Of course neither paper acknowledged that the source of the $300 billion dollars was a Credit Suisse report out 24 hours earlier, not “China”.

This morning both papers have back-tracked and rewritten their stories as a “possible” stimulus. The AFR went so far as to commission Huy McKay (Phat Dragon) to write a more sober assessment of where things stand.

If you really wanted to know what was going on, you could have read all of it here yesterday. The editors at both papers clearly did, belatedly.

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Comments

  1. Australia needs its milkie wilkies, and any hint that Great Boob will deliver must be breathlessly reported.

      • Indeed. This is a crushing blow for the MineBots…

        the official Xinhua News Agency reported.

        “The Chinese government’s intention is very clear: It will not roll out another massive stimulus plan to seek high economic growth,” Xinhua said yesterday in the seventh paragraph of a Chinese-language article on economic policy, without attributing the information. “The current efforts for stabilizing growth will not repeat the old way of three years ago.”

        It doesn’t get much clearer than that. No Milkie Wilkies. What’s the plan now MineBots?

        • This is a crushing blow for the MineBots…

          and possibly a crushing blow for this country’s terms of trade so you might want to contain your glee

          • I’m in the long-suffering slow lane of the Aussie economy. Any reduction in the terms-of-trade means a weaker currency, which is nothing but good news for me.

      • HnH. The omission of the source (Credit Suisse) on the part of some reports was a small fault. We will have to wait and see just what form of stimulus our inscrutable economic trade partners undertake. But there will be something.

        The simultaneous approval for three major steel production projects (each circa $10b) would indicate ongoing infrastructure investment in China and augers well for Australian resources.

        • But there will be something.

          There will be milkie wilkies! There has to be! We are Australian miners, God’s chosen people!

          • There will be something. Not as significant as the post-GFC stimulus, but enough to temper slowdown. Imminent change of leadership will require smooth transition with stable economy and society. New leadership may then unleash the dogs of stimulus as part of its own drive for stability and citizen respect.

            All the hallmarks are there: announcements for affordable housing, resumption of construction of rail network (cleared the decks by removal of previous head), rebuilding of water treatment plants, approval for three massive steel production plants…you get the idea.

          • i have to agree – there will be something.

            TPTB of the CCP (rhyming?!) simply won’t let “face” be “harmed” too much.

            I know they have inflationary and social uinrest concerns to consider, but there is also “much honour” at stake, etc, etc…

            Dropping reserve ratios and IRs aren’t going to work in a debt-deflation (or even disinflation) environment, so “free money” is the next best thing.

            My 2c

            My 2c

  2. A lot of bluster about misreporting (an apparent) bullish scenario. How often do we see things misreported as bearish. Most recent event that comes to mind is Mr Ashby from BHP talks up demand for iron ore and the world reports him as talking it down. Then we had Nomura seeing a similar demand as far as the eye can see yet their analysis was declared as the end of the super cycle (or some similar “sky is falling” type headline).

    …and so on.

    Journos have their agendas. Anyone believing what they read without examining original sources may get bitten.

    • So, you endorse misreporting so long as it’s bullish? Ashby wasn’t misreported. The media reported the reality under his spin which then, um, led to BHP totally changing strategy…

      • did you wake up irritable today?

        what part of my comment endorsed misreporting? I was observing that it happens and that punters should always try to seek original sources when possible.

        And Ashby was definitely misreported — in part because to be a journo you do not have to know what a derivative (rate of change) is. I have seen Ashby’s original presentation — have you?

  3. You are cruel. With this fake news, you got MineBot’s hopes up and then mercilessly crushed it. 🙂

  4. Cognitive Dissonance

    Some cleaver-clogs wrote this on the 23/05

    “I am suspicious at the latest round of headlines from China (or at least we are told it is from China).

    “First it is ‘oh look lines on graphs are pointing the wrong way….blah blah blah “landing” this or “landing” that

    “Then a few days later it is blah blah response / stimulus talk as if to say the government are reading the headlines along with us

    “I don’t know about you but this reeks of headline management.

    “These people have a fair idea what the future holds long before the graphs come out, they are the ones that control the spending these graphs are largely based on, and will have any response(s) ready long before we get a change to read about it in any paper. The said “stimulus” is a long term ongoing thing it is not a ‘response’ to something they did not see coming as the papers seem to suggest so the headline line reading / TV watching numb skulls of the world can go back to sleep.”

    • dumb_non_economist

      Yes Mainlander, this is correct, but you have missed an important point. No or little gravity and no north/south, up/down so therefor RE prices will have little to restrain them from “reaching for the sky,” unlike on planet earth!!

    • Hoe Jockey and Aony Tbbott

      Have you not seen Iron Sky? The Nazi’s already own the moon. The Chinese will have to fight them for it! All hail the Moon Führer!

  5. Meanwhile in the mainstream media, I still see stories about the coming Chinese stimulus and nothing about the official statement from Xinhua denying any plans for massive stimulus.

    http://www.theaustralian.com.au/business/economics/australia-to-gain-from-chinese-kickstart/story-e6frg926-1226373037212

    AUSTRALIA’S economy is set to benefit from the Chinese government’s quiet unleashing of a stimulus package worth as much as 2 trillion yuan ($300 billion)…

    http://www.smh.com.au/business/china-set-for-structural-stimulus-plan-20120529-1zhbp.html

    DETAILS of a big new Chinese stimulus package were emerging in Beijing late yesterday…

    Blatant mis-reporting or just ill-informed? WTH is going on?

  6. innocent bystander

    damn. for a minute I thought my moon mining rights had come good – think of the freight advantage I had !

  7. You forgot to mention the billion-plus rural Chinese who simply must migrate to the moon.

    (To build the apartments, that is. Following which they won’t be able to afford to live in them so they’ll just go back to where there came from.)

    Never forget the billion-plus rural Chines. You know, the ones who really aspire to eat more pork.

    • Yes, one wonders what happened to billions of rural Chinese that were clamouring to move to the city and buy overpriced apartments. How come the Chinese economy requires stimulus when we’re in the midst of the greatest urbanisation in history?

  8. Have just heard a rumour from the HIA that they will be asking the govt for a first moonbuyers grant program to get this up and running. Tradies – get set for moon FIFO packages coming soon.

    • boyracerMEMBER

      hopefully this time they can convince the govt to get the structure of the grant right and index it so that as moon prices increase the grant will rise to match them. You know it makes sense 🙂

    • dumb_non_economist

      Sorry, the FIFO rumour is just that. They are unable to source enough airframes at the end of their useful life. FIFO requires > than 50,000 cycles and > 20 yrs since manufacture, though I do hear that there are some shuttles going cheap.

  9. Just Dismal 2

    3 massive steel plants to go ahead, in the name of sector consolidation. Make war for peace. Marxist dialectic. The said projects couldn’t make it into the last round. Running out of options might be the truth. That’s why only a crisis will save the world.

  10. Just Dismal 2

    China is stuck somewhere between the soviet union and Japan. We are dependent on China. Wake up!

  11. rob barrattMEMBER

    The good news is that the projected moonside rental plus the cost of daily commuting to earth will be marginally cheaper than renting a fibro shack in Morranbah, thus paving the way for more workers on temporary visas.

  12. What will the spruikers like Dr Ando say when moon house prices inevitably go up – House prices to the moon… err.. Earth.

  13. Is H&H posing as John Cleese? Thisdebate would make Monty Python proud, but as endless Chinese fixed asset investment is entering into farce mode, it’s most appropriate. Made me laugh anyway.

  14. On the moon unemployment is currently steady at 0%, inflation is stable, GDP per capita is infinite…. With economic fundamentals like that, you’d be over the moon.