China Economy


China’s unasked questions

An awful lot of rubbish is written about China. Such as how China’s property market is overheating, or its exports unbalancing the world economy. So here are a few questions. When did private property ownership start in China? About a decade ago. Who owns most of the land? The Party (which of course gives them


Geopolitical risk: don’t forget China

Investors are nervously watching the situation in Libya unfold this week as fears grow that the unrest could spread to larger neighboring countries like Saudi Arabia, disrupting the supply of oil.  Oil rose above $100 a barrel in New York today, while one investment bank predicted that if Libya and Algeria alone were to halt


Westpac warns on 2012 China bust

This superblog has not made an editorial decision to suddenly be kind to the banks. But credit where credit is due and Westpac joins CBA (praised by the Unconventional Economist today) in having produced an excellent piece of research (h/t The Lorax). This time on China. Indeed, this blogger will go so far as to say that


Pettis on Chinese inflation

From Michael Pettis’ exclusive newsletter: Last week the National Bureau of Statistics released inflation data for the month of January: In January 2011, consumer price index rose by 4.9 percent over the same period of the previous year. Of which, urban area and rural area was up by 4.8 percent and 5.2 percent respectively; the price


Pettis on Chinese liquidity

From Michael Pettis’ exclusive newsletter: Because of the lunar New Year festivities not a whole lot happened in China last week, not counting of course the never-ending stream of fireworks and the several really great jiao zi dinners I have managed to snag from my students and their families.  I have nonetheless been getting a lot


Yuan gush

From Michael Pettis’s exclusive newsletter comes this update on Chinese lending and interest rates: It seems that already bankers might be anticipating the relaxation of lending targets.  Rumors on the ground suggest that new lending in January may come in as high as RMB 1.2 trillion.  This might seem pretty strong evidence that the PBoC


The China domino

The stated goal of the Hu Jintao-led Chinese government is a “harmonious society”. Perhaps that is why the word “Egypt” was blocked on certain search engines over the weekend. Multiple factors are in play in Egypt, but there is one vital similarity with China: Food inflation of a breadth and severity that few in the


China’s blunder

The ongoing demise of the Bretton Woods II (BWII) currency system and its implications for the balance of world growth has been a recurrent theme for this blog. And if recent commentary around China is any guide, the breakdown is accelerating toward another critical moment. To recount, this blogger wrote last year: BWII is the


Guest post: Of China and guano

Following the La Niña-related floods in Queensland earlier this month food prices have spiked, adding to an already serious inflation crisis around the world and toppling the government of Tunisia. And while protesters in Tunis were hardly thinking of Queensland bananas or sugarcane as they mobbed the streets, the changing and dramatic climatic conditions that


La Nina as Black Swan update

For those that missed it, Yves Smith of Naked Capitalism fame quoted liberally from our very own Flashman over the weekend, firing off a frenzy of activity. Amongst that traffic was a comment from Bruce Krasting that included an excellent link comparing this super La Nina with those of the past. He concludes: You are


Different week, same story.

Another week, but the same stories everywhere. As we have spoken about many times before China has got itself into all sort of trouble with building and infrastructure projects going nowhere.   Chinese banks may struggle to recoup about 23 percent of the 7.7 trillion yuan ($1.1 trillion) they’ve lent to finance local government infrastructure