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yes. and pogs
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Feb 11, 2016 21:18
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cheesetriangles posted:So they need to print 10 trillion and only have 2.2 trillion of hard currency that sounds like it might be an issue but I'm not an economist. Is this good for bitcoin? Are you kidding me? Of course it's good for bitcoin, because... 
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Feb 11, 2016 21:44
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I remembering hearing on bloomberg that while China has a lot of foreign currency reserves, the lower bound (i.e the minimum they need) is lot higher than 0$, meaning they might run into trouble a lot sooner. Can anyone explain more?
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Feb 11, 2016 22:38
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Jumpingmanjim posted:I remembering hearing on bloomberg that while China has a lot of foreign currency reserves, the lower bound (i.e the minimum they need) is lot higher than 0$, meaning they might run into trouble a lot sooner. Can anyone explain more? This is just an educated guess but they probably have to import things and people will want payment in dollars or euros and not yuan.
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Feb 11, 2016 23:19
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Jumpingmanjim posted:I remembering hearing on bloomberg that while China has a lot of foreign currency reserves, the lower bound (i.e the minimum they need) is lot higher than 0$, meaning they might run into trouble a lot sooner. Can anyone explain more? Foreign exchange reserves are used to manipulate a country's exchange rate / currency value. So them running out of dollar reserves basically would mean they have no control over the valuation of the yuan anymore. I'm not sure how big a problem that would be, though
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Feb 12, 2016 00:06
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icantfindaname posted:Foreign exchange reserves are used to manipulate a country's exchange rate / currency value. So them running out of dollar reserves basically would mean they have no control over the valuation of the yuan anymore. I'm not sure how big a problem that would be, though China keeps their Yuan artificially low. So if they can't control it, I guess it might rise in value making their exports more expensive. But that won't be a problem after they print 10 trillion more of them.
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Feb 12, 2016 00:40
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China's actually trying to keep the rmb high by buying it up with their foreign reserves. If the yuan goes too low, there's no telling how many shadow banks and banana carts that are gonna get flipped over, because it would get too expensive to pay back all the money the borrowed
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Feb 12, 2016 01:01
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So wait, I shouldn't have started hoarding RMB for the inevitable day it replaces the US Dollar?
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Feb 12, 2016 01:14
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Newfie posted:And here I thought the 2008 recession was the worst economic downturn I would see before I finished law school. Chinese economy implodes and takes everyone with it? We aren't connected to china as much as you might think. Well at least the US will be fine, europe is teetering and anything can push them over the edge right now.
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Feb 12, 2016 01:27
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TROIKA CURES GREEK posted:We aren't connected to china as much as you might think. Well at least the US will be fine, europe is teetering and anything can push them over the edge right now. You just proved his point though. We may not be directly tied to China, but we are tied to Europe, so China is more contagion than direct cause. It's the same thing with Iran and other countries selling oil. As long as they are selling to SOMEONE they affect our own oil price, even if we aren't buying their oil.
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Feb 12, 2016 01:33
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Supposing China actually had a bag of endless fx reserves, how long does it need to defend the rmb for? Until the next US recession? Until Europe starts buying things again? Until rmb shorts start to disappear? Whats the endgoal for all this defence of the rmb?
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Feb 12, 2016 01:42
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ComradeCosmobot posted:You just proved his point though. We may not be directly tied to China, but we are tied to Europe, so China is more contagion than direct cause. What are Europe's ties to China? I figured they were an importer of Chinese goods like the US. Those goods get cheaper the deeper China sinks. This hurts manufacturing in the US and Europe, but is no where near the shitstorm that countries who export raw materials to China are facing. One nice thing about China's economy is that their financial system is relatively isolated. Subprime mortgages tanked both the US and Europe, but China's financial instruments are mostly owned by the Chinese. At least, I hope they are.
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Feb 12, 2016 01:52
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Krispy Kareem posted:What are Europe's ties to China? I figured they were an importer of Chinese goods like the US. Those goods get cheaper the deeper China sinks. This hurts manufacturing in the US and Europe, but is no where near the shitstorm that countries who export raw materials to China are facing. One example I recall being mentioned in this thread was that to buy Chinese A-shares on their stock market, you have to be a Chinese firm. Presumably this is the financial version of "If you want to use our manufacturing, give us your IP."
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Feb 12, 2016 01:54
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Krispy Kareem posted:What are Europe's ties to China? I figured they were an importer of Chinese goods like the US. Those goods get cheaper the deeper China sinks. This hurts manufacturing in the US and Europe, but is no where near the shitstorm that countries who export raw materials to China are facing. China's financial system isn't so much isolated as it is irrelevant. The 2008 financial crisis shat all over the Chinese economy but an equivilent one in China wouldn't poo poo all over the US and EU economies, although the latter is more sensitive to contagion than the former.
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Feb 12, 2016 05:33
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http://www.bloomberg.com/news/articles/2016-02-12/yuan-declines-most-in-two-weeks-as-global-selloff-saps-sentimentquote:Yuan Declines Most in Two Weeks as Global Selloff Saps Sentiment
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Feb 12, 2016 06:00
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Just devalue already lol
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Feb 12, 2016 06:42
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The Yuan M2 money supply is about 13 trillion. Printing another 10 trillion is almost doubling the money supply. Anyone know how much extra money it takes to start hyperinflation? It seems like China could patch their banks' gaping hole without too much pain. Unless their corporate debts are held in another country's currency.
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Feb 12, 2016 14:25
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Arkane in 2013 posted:So I just watched this ~50 minute talk by Kyle Bass, the hedge fund guru who bet heavily on the mortgage crisis in 2007, and he has determined that without a shadow of a doubt Japan is hosed. It's an interesting watch if economics is your fancy. Chinese statements about their economy have limited credibility, but there's a cottage industry of financial analysts who don't understand how money or macroeconomics work making bank predicting doom for $COUNTRY, and they have none at all. Peel fucked around with this message at 15:13 on Feb 12, 2016 |
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Feb 12, 2016 15:05
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Well I know when to plan my vacation to Japan.
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Feb 12, 2016 15:12
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Sorry, that should have been 'Arkane in 2013'. The time limit for the collapse of Japan came and went without so much as a blip. Remember that Western nations and Japan have flooded their banks with liquidity in recent times via QE, and yet they are failing to get their inflation up to target. This is despite hysteria from financial commentators and politicians about how hyperinflation is around the corner due to money printing. Recessions cause deflationary pressure. If the Chinese government spends enough money to arrest this in response to the slowdown, they will be doing more than Western governments did in response to ours, and so hewing closer to orthodox economics.
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Feb 12, 2016 15:14
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If you cry wolf long enough you look prophetic when one finally shows up. I am wondering if the bigger effect of a Chinese economic implosion would be the lengths that the government would go to in order to keep their people from getting pissed at them. The nationalism and sabre rattling in the form of aggressive marine territory claims are already there but could get much worse.
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Feb 12, 2016 15:15
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Peel posted:Sorry, that should have been 'Arkane in 2013'. The time limit for the collapse of Japan came and went without so much as a blip. Surely doubling the entire supply of your currency is a bit more than just a little inflation.
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Feb 12, 2016 15:20
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Not if money velocity goes down by half, and that's assuming you believe Bass's figures.
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Feb 12, 2016 15:29
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cheesetriangles posted:Surely doubling the entire supply of your currency is a bit more than just a little inflation. The US money supply has nearly tripled since 2000, and I believe is double what it was in 2007. Despite that, we've not just not had hyperinflation, but we also had a few periods of deflation. While granted the US' position as premier economic market and currency affects that, it still means you can't rely on massively increased money supplies to lead to inflation, when there's the right entities around to soak up the money.
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Feb 12, 2016 16:00
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fishmech posted:The US money supply has nearly tripled since 2000, and I believe is double what it was in 2007. Despite that, we've not just not had hyperinflation, but we also had a few periods of deflation. When do I get my share.
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Feb 12, 2016 16:04
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cheesetriangles posted:Surely doubling the entire supply of your currency is a bit more than just a little inflation. I imagine it would also, unless the money is kept in the banks like all those trillions we printed. Although making your money worth less means you have to print more to keep the government running, so it's not like you're going to get away with 'one and done'. It'd be interesting terrifying to see how bootstraps China can fare compared to an entitlement rich state like Venezuela. I just checked those numbers and Hugo's Socialist utopia increased their M2 supply 5x between 2014 and 2015. Those are official figures so it's likely a lot more. But China and Venezuela have polar opposite economies so not the best comparison.
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Feb 12, 2016 16:07
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http://nyti.ms/1Ly29si The first head has rolled, wonder if this will change anything regarding all the stock buying going on.
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Feb 20, 2016 06:59
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This was also in the Nytimes the other day: China’s Foreign Exchange Reserves Dwindling Rapidly quote:A year and a half ago, China held as much as $4 trillion in foreign exchange reserves. The reserves represented a symbolic trophy for China’s leaders, who have described them as the “blood and sweat” of the workers and upheld them as a sign of national strength.
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Feb 20, 2016 15:15
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Is there any place to get a good neutral overview of China's investment projects in cheap countries and what kind of success they've had? I never get to read about it 
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Feb 21, 2016 04:53
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Uncle Jam posted:Is there any place to get a good neutral overview of China's investment projects in cheap countries and what kind of success they've had? I never get to read about it http://foreignpolicy.com/2015/12/04/5-myths-about-chinese-investment-in-africa/
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Feb 21, 2016 04:59
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Shifty Pony posted:This was also in the Nytimes the other day: My father worked for many years in one of the international finance organizations set up after WW2. He's seen reports that many of the dollars the Chinese say they have in their reserves are dollars that they've loaned out or otherwise cannot readily use. Essentially it's not just that the Chinese are burning through their reserves, but that their reserves are inflated and much of what they do have is illiquid and couldn't be used in a pinch.
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Feb 22, 2016 01:35
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Uncle Jam posted:Is there any place to get a good neutral overview of China's investment projects in cheap countries and what kind of success they've had? I never get to read about it While it's not necessarily "cheap" countries, if you'd like to go direct to a reputable source: https://www.treasury.gov/resource-center/international/foreign-investment/Documents/Annual%20Report%20to%20Congress%20for%20CY2014.pdf (may be direct download) Head to Page 29 for the Key Findings. Tl;dr China has a coordinated strategy to acquire and invest in projects and companies which further China's security interests, whether these be in America or elsewhere. East African development projects are a bit of my specialty, especially within the kiswahili-speaking world. Generally, what you find are unsustainable white elephant projects as quid pro quo's for Chinese acquisition of something vital to Chinese security or otherwise Chinese domestic interests. Railroads to nowhere for naval bases; hospitals with walls falling in on themselves for resource monopolies; machettes and other arms direct to military and militia officers, to develop independent power bases. As to what sort of success these projects are, depends how you define success. Successful at pushing a Chinese national security agenda? Or do you mean profitable or otherwise sustainable enterprises? Because there are plenty of Chinese roads to nowhere which are expenses that can never hope to be recoup'd, especially at current resource prices.
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Feb 22, 2016 04:09
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hypnorotic posted:My father worked for many years in one of the international finance organizations set up after WW2. He's seen reports that many of the dollars the Chinese say they have in their reserves are dollars that they've loaned out or otherwise cannot readily use. Essentially it's not just that the Chinese are burning through their reserves, but that their reserves are inflated and much of what they do have is illiquid and couldn't be used in a pinch. The moment when the world realizes how the Chinese have managed their reserves will be after the Chinese have run out. Like hell the communists will admit to it; they'll probably implement every measure possible to deny the obvious, like lowering the official exchange rate and prohibiting transactions in currencies other than their own. Perhaps this is why the Chinese were so adament about their currency being declared a main global currency by IMF, and perhaps the collapse of China's economy will be the death knell of IMF's current iteration. I don't know why individuals still have money in China, and haven't cashed out before the ponzi flops over itself.
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Feb 22, 2016 04:17
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shcomp is almost back up to 3000. wrap it up sinophobes
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Feb 22, 2016 05:36
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Whats this its like 4th rebound? Can't wait for them to run out of burnable cash.
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Feb 22, 2016 08:51
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Cultural Imperial posted:shcomp is almost back up to 3000. wrap it up sinophobes  are you ready for the Chinese century?
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Feb 22, 2016 11:05
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Is anybody in China worried at all about rising sea levels? Looking at google earth it looks like there's massive amounts of new construction constantly happening at the very edge of shores, it's as if nobody's bothered at all that trillions of dollars may someday be underwater. To me that seems to be the biggest threat to China that hardly anybody is talking about; the fact that so much of the population lives near sea level. In that way it's a lot like Miami I guess, were so many people are in perpetual denial about their future.
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Feb 23, 2016 19:46
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Ervin K posted:Is anybody in China worried at all about rising sea levels? Looking at google earth it looks like there's massive amounts of new construction constantly happening at the very edge of shores, it's as if nobody's bothered at all that trillions of dollars may someday be underwater. To me that seems to be the biggest threat to China that hardly anybody is talking about; the fact that so much of the population lives near sea level. That's not really a problem unique to China in any way.
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Feb 23, 2016 20:55
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Just pass laws against saying climate change or sea level rise is real, solved the problem for a lot of the southern US.
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Feb 23, 2016 21:08
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Levies have existed for a long time, Amsterdam and New Orleans won't be going anywhere soon.
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Feb 23, 2016 21:13
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