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Ardennes posted:In the case of China, wages are lower in the interior and the countryside than the coast, but the coast also has immediate access to shipping routes so I don't know if you are going to have the same dynamics. Almost certainly not. SOEs are moving/being moved into the interior but the wage differential is simply not making up for the logistic nightmare involved. I know a guy who runs a state owned chemical firm who opened a major plant in Inner Mongolia: he was saying that the plant is vastly less economical than the Shanghai-based plant it replaced. Basically trucks are backed up all along the roads running to it, and the management are almost all relocated due to lack of local expertise (meaning they are on higher salaries than they would have been in Shanghai). If Chinese SOEs can't make it work it's reasonable to assume that multinationals will be more likely to move to coastal Vietnam, Indonesia, Bangladesh etc. than to the Chinese hinterland.
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# ? Nov 25, 2014 18:22 |
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# ? May 13, 2024 07:37 |
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Daduzi posted:Almost certainly not. SOEs are moving/being moved into the interior but the wage differential is simply not making up for the logistic nightmare involved. I know a guy who runs a state owned chemical firm who opened a major plant in Inner Mongolia: he was saying that the plant is vastly less economical than the Shanghai-based plant it replaced. Basically trucks are backed up all along the roads running to it, and the management are almost all relocated due to lack of local expertise (meaning they are on higher salaries than they would have been in Shanghai). Basically that is the trap, China can't lower wages on the coast and there are such a multitude of infrastructure and logistics issues to overcome in the interior that makes foreign competition more attractive. However, standards of living even in Chinese coastal cities isn't nearly anywhere close to the first world, but China has to deal with some of the very issues of first world countries such as inverted demographics and rigorous foreign competition for exports. That said, China wouldn't be where it is today without US trade policy being extremely friendly and that is largely a legacy of the Cold War and the Sino-Soviet split.
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# ? Nov 25, 2014 18:50 |
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Gee, maybe they should be building truck and rail corridors between some inland cities and the sea ports rather than golf courses and shopping malls.
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# ? Nov 25, 2014 18:56 |
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VideoTapir posted:Gee, maybe they should be building truck and rail corridors between some inland cities and the sea ports rather than golf courses and shopping malls. To be fair they have. Ultimately though the sheer volume of traffic that goes from Chinese ports would require an utterly ludicrous level of infrastructure to accommodate, unless all of the interior development were concentrated in one area (which kind of defeats the purpose).
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# ? Nov 25, 2014 19:05 |
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Daduzi posted:To be fair they have. Ultimately though the sheer volume of traffic that goes from Chinese ports would require an utterly ludicrous level of infrastructure to accommodate, unless all of the interior development were concentrated in one area (which kind of defeats the purpose). Of the top 10 ports in the world China has 7 of them that handled roughly 157,000 TEUs of volume last year . I could see that creating all sorts of fun logistical problems.
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# ? Nov 25, 2014 20:15 |
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computer parts posted:"Look like Detroit" is a bit of an exaggeration but yes. This is sort of the opposite of what happened in the US/Europe, where the Chinese just decided to say "build all the infrastructure for stimulus" and didn't stop. Just to clarify: Detroit was just an exaggeration as to how even if China went into an economic crisis and recession their reports would still indicate a strong growth because they're so inaccurate and fudged to look better. rex rabidorum vires posted:Of the top 10 ports in the world China has 7 of them that handled roughly 157,000 TEUs of volume last year . I could see that creating all sorts of fun logistical problems.
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# ? Nov 25, 2014 23:56 |
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How far to the negative would China's real GDP have to go before the official number went to 0%? I am curious what sort of behaviour we will start to see in China when the economy dips since no one can actually believe the numbers anyways.
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# ? Nov 26, 2014 00:01 |
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Probably the same as Japan, IE lower the interest rate to 0%, print money forever, and not actually fix the underlying problems ever, with no effect. The only difference is that the Chinese population might get pissed enough that the growth stopped so soon and with so much comical environmental damage that they'll threaten the stability of the government, in that case, who knows what happens
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# ? Nov 26, 2014 00:16 |
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icantfindaname posted:Probably the same as Japan, IE lower the interest rate to 0%, print money forever, and not actually fix the underlying problems ever, with no effect. The only difference is that the Chinese population might get pissed enough that the growth stopped so soon and with so much comical environmental damage that they'll threaten the stability of the government, in that case, who knows what happens Yeah, but that would be an official response to the issue. Since China is wholly committed to the idea of growth forever, I expect them to never do any of the things other governments would do when they have a downturn. My economic behaviour is semi-rational based on what I witness in my day to day life, and because I can believe the numbers that are published about my country. China will be an interesting experiment to see what happens when you remove one of those inputs. My question was more "What the population will do?" when the economy turns, but is still officially 5%, rather than what the government will do.
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# ? Nov 26, 2014 00:29 |
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ocrumsprug posted:How far to the negative would China's real GDP have to go before the official number went to 0%? I doubt the government would ever report less than 3-5% even if the economic was in complete freefall. I think we might see more local disturbances, but it is seems unlikely there would be a real movement that would threaten the government itself. That said, there is no way that the state legitimacy is going to take a giant hit, and Beijing is going to take every effort to keep the situation suppressed. Ultimately, it is in the interests of Western companies who manufacture goods in China to keep the situation stable and that means it is in the interests of Western governments as well.
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# ? Nov 26, 2014 00:53 |
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http://www.ft.com/intl/fastft/246461quote:
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# ? Dec 5, 2014 06:30 |
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This is probably really stupid and wrong but I imagine there are a lot of business owners and managers with extreme debt about to come due who are investing as a last ditch effort to make money to pay off or extend the debts.
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# ? Dec 5, 2014 09:26 |
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Well the Shanghai Composite have been extremely active recently because of the Hong Kong - Shanghai Stock through train. It's much easier for Hong Kongers and the outside world investing in the SHanghai stock market through Hong Kong. During the opening week the HK stock market actually tanked and i lost 10% in holdings. But the Shanghai side though it was just rally after rally after rally.
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# ? Dec 5, 2014 10:47 |
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Literally every investing and econ publication i have read today has called this an irrational frenzy. Since we know hosed up banking policy has forced investment into non traditional real estate and WMP outlets I'm inclined to believe this huge rally and volatility has nothing to do with fundamentals (iron ore imports still falling, electricity demand still slowing) and is all about ravenous demand for investment that's been suppressed for a long time.
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# ? Dec 5, 2014 12:21 |
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I thought the same thing too but Chinese people haven't been unable to invest in Chinese stocks at any point have they? Even if Joe Chinaman decides that an apartment isn't a good investment anymore and he's worried about the black market investment products, he's not going to be exuberantly investing in the stock market. Everyone I know in China considers it little more than gambling. Not that they don't like gambling but how do you cheat on your wife when you're calling in the stocks??
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# ? Dec 5, 2014 15:00 |
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Yeah, but greed takes over, and waiting for rent takes too long. Plus you really can only squeeze so much from a dying country/world, so you have to turn to speculation, or you fall behind the new rich.
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# ? Dec 5, 2014 22:51 |
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Fall Sick and Die posted:I thought the same thing too but Chinese people haven't been unable to invest in Chinese stocks at any point have they? Even if Joe Chinaman decides that an apartment isn't a good investment anymore and he's worried about the black market investment products, he's not going to be exuberantly investing in the stock market. Everyone I know in China considers it little more than gambling. Not that they don't like gambling but how do you cheat on your wife when you're calling in the stocks?? I went to a lecture at Tsinghua in early 2013 where the professor was talking about investment in china and saying that basically no Chinese stocks pay dividends. The way he framed it was that virtually no money in China goes to public investors, everything goes to insiders. So essentially yes, it is gambling. VideoTapir fucked around with this message at 22:17 on Dec 7, 2014 |
# ? Dec 7, 2014 22:14 |
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Buying mainland stocks that aren't (i.e. can't because they can't/don't want to meet reporting and governance requirements) listed in Hong Kong is not investing. It's gambling. Even more than playing stocks is already gambling. Mainland stock markets are almost literally casinos because everything about the listed companies is completely opaque. It's why valuations are so low there and why there have been barely any mainland buyers taking advantage of the Through Train. It's all been Hong Kongers going the other way for some stupid reason.
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# ? Dec 8, 2014 03:33 |
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I never would have guessed that a stock market bubble would have killed off china before it's housing bubble did.Bloodnose posted:Buying mainland stocks that aren't (i.e. can't because they can't/don't want to meet reporting and governance requirements) listed in Hong Kong is not investing. It's gambling. Even more than playing stocks is already gambling. Mainland stock markets are almost literally casinos because everything about the listed companies is completely opaque. It's why valuations are so low there and why there have been barely any mainland buyers taking advantage of the Through Train. It's all been Hong Kongers going the other way for some stupid reason. Wait so the money is going in the opposite direction that it should be?
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# ? Dec 8, 2014 12:13 |
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quote:Nice from Simon Rabinovitch at the Economist: quote:That’s the Shanghai Comp breaching the 3000 mark at pixel time, up 30 per cent since October and 41 per cent this year. Hahhahahahahah
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# ? Dec 8, 2014 15:40 |
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Jumpingmanjim posted:I never would have guessed that a stock market bubble would have killed off china before it's housing bubble did. Why not both at once? Japan did it, so can China
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# ? Dec 8, 2014 16:56 |
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icantfindaname posted:Why not both at once? Japan did it, so can China All this talk of large numbers of retail investors moving into the market and getting leveraged up is giving me a real 1929 vibe.
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# ? Dec 8, 2014 21:32 |
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icantfindaname posted:Why not both at once? Japan did it, so can China Japan's bubble was triggered by the raising yen. China hasn't allowed Yuan appropriated. As a matter of fact China has showed IMF it's willing to drag IMF mediating functions to a haul if it get any more hush criticism from IMF. I don't think China's domestic stock market will get a decent bubble in the near future. Low return in stock market and high saving rate are two sides of the same coin. If China want Chinese keep putting money in the low interest saving accounts, they wouldn't let the stock market take off.
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# ? Dec 9, 2014 03:49 |
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http://www.stratfor.com/analysis/lower-oil-prices-carry-geopolitical-consequencesquote:Summary Bolded the relevant portion. What I'm wondering is---how? My impression is that there aren't very many economically-multiplying projects left in China. Only major one I can think of would be a complete phase-out of coal power for LNG, nuclear, and renewable sources. Have there been any purges of all the coal-linked networks lately?
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# ? Dec 13, 2014 05:59 |
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China just increased gas tax to keep domestic gas price high after the international gas price drop. This world wide gas firesale is basically the Americans and the Arabs's conspiracy to punish the commie infidel Russkies . It's going to totally crash Venezuela by accident.
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# ? Dec 13, 2014 06:41 |
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whatever7 posted:China just increased gas tax to keep domestic gas price high after the international gas price drop. Its not a conspiracy, its market forces at work. Its what you get when you fail to implement structural reform in China. Venezuela, I see developong insurgency or foreign coup. Nigeria? Now there's a failed-state waiting to happen. China? Totally hosed by low oil prices.
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# ? Dec 13, 2014 06:59 |
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My Imaginary GF posted:http://www.stratfor.com/analysis/lower-oil-prices-carry-geopolitical-consequences Dig holes and fill them up again?
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# ? Dec 13, 2014 12:31 |
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My Imaginary GF posted:
It's a major priority to get nuclear up and running but they're still a decade out for operational plants iirc.
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# ? Dec 13, 2014 15:09 |
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Why is low oil prices a problem for the chinese economy? Lower energy costs should be a boon if you are industrial powerhose. Consumers will have to spend less on petrol and can therefore spend more on other things. Since China consumes more oil than it produces does it not stand to gain from low prices?
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# ? Dec 13, 2014 17:20 |
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Baudolino posted:Why is low oil prices a problem for the chinese economy? Lower energy costs should be a boon if you are industrial powerhose. Consumers will have to spend less on petrol and can therefore spend more on other things. Since China consumes more oil than it produces does it not stand to gain from low prices? Agreed, low energy prices should be a concern mostly to energy exporters. Any heavily manufacturing economies should be stimulated by low energy prices.
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# ? Dec 13, 2014 17:41 |
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Baudolino posted:Why is low oil prices a problem for the chinese economy? Lower energy costs should be a boon if you are industrial powerhose. Consumers will have to spend less on petrol and can therefore spend more on other things. Since China consumes more oil than it produces does it not stand to gain from low prices? Less consumers for Chinese goods. China has a major market share of foreign infrastructure development projects, especially energy-related ones throughout Africa. Combined with the continued purge, additional capital flight will result in the need to expand the purge to raise capital and shore up the liquid foreign currency reserves, expediting liquid foreign currency flight.
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# ? Dec 13, 2014 21:47 |
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My Imaginary GF posted:Less consumers for Chinese goods. China has a major market share of foreign infrastructure development projects, especially energy-related ones throughout Africa. Combined with the continued purge, additional capital flight will result in the need to expand the purge to raise capital and shore up the liquid foreign currency reserves, expediting liquid foreign currency flight. The issue being that it isn't going to affect the first world and much of the third world very much. Yes, Russian and Venezuelan consumers will be effected but the Chinese economy isn't dependent on them. Cheap oil is theoretically a very good thing for China as it allows them to produce exports cheaper which is the central focus of their economy. The anti-corruption purge is completely separate issue.
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# ? Dec 13, 2014 22:44 |
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My Imaginary GF has a really weird fascination with purges. I think he might have a purge fetish. He brings them up in every post about China.
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# ? Dec 14, 2014 00:24 |
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Bloodnose posted:My Imaginary GF has a really weird fascination with purges. I think he might have a purge fetish. He brings them up in every post about China.
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# ? Dec 14, 2014 00:38 |
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My Imaginary GF posted:Less consumers for Chinese goods. Who are China's largest export customers? What effect does lower energy costs have on domestic consumption in those countries. Hint: it doesn't suppress it.
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# ? Dec 14, 2014 02:45 |
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Hm. What's the price of oil do to Chinese shipping and ship manufacturing?
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# ? Dec 14, 2014 03:34 |
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Bloodnose posted:My Imaginary GF has a really weird fascination with purges. I think he might have a purge fetish. He brings them up in every post about China. There is an ongoing purge, no matter what PRC deigns to call it. I'm expecting it to hit Macau soon. Warcabbit posted:Hm. What's the price of oil do to Chinese shipping and ship manufacturing? Shipping? Its bad for shipping, actually, because China has over-produced international shipping capacity. What that means is that you have to subsidize the carriers to take your cargo. Lower prices mean lower margins for some shippers, slightly higher for others, and require increases in subsidies to shippers in order to take your goods. The more you produce that needs to be exported, the more you need to subsidize carriers to take your products to international market. Its quite a contradictory system: the more you ship, the higher your operating costs. My Imaginary GF fucked around with this message at 04:03 on Dec 14, 2014 |
# ? Dec 14, 2014 03:59 |
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My Imaginary GF posted:There is an ongoing purge, no matter what PRC deigns to call it. I'm expecting it to hit Macau soon. This line of reasoning just doesn't make sense to me. Over capacity issues aside, Why would lower oil costs lower profit margins?
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# ? Dec 14, 2014 04:11 |
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GlassEye-Boy posted:This line of reasoning just doesn't make sense to me. Over capacity issues aside, Why would lower oil costs lower profit margins? Because you're losing money on every product you export, and exporting more products won't increase your revenue. Lower oil prices increase the pressure to produce more in order to maintain the facade that your enterprise isn't a pyramid scheme.
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# ? Dec 14, 2014 04:20 |
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# ? May 13, 2024 07:37 |
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My Imaginary GF posted:There is an ongoing purge, no matter what PRC deigns to call it. I'm expecting it to hit Macau soon. Macau is a Special Administrative Region that operates on a different legal and political system from the mainland. You've been having trouble understanding this with regard to Hong Kong too. I don't know how to make it any clearer for you. There are no Communist Party members in the Hong Kong or Macau governments. There is no Communist Party in either territory's political system. They don't purge in those territories. It doesn't happen. Unless you mean an economic hit, in which case, welcome to months ago. Gambling revenue reports are out and they've already indicated the first drop in the rake since the liberalization of casino licenses.
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# ? Dec 14, 2014 04:44 |