China Economy Megathread

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Potato Salad: Oct 23, 2014; nobody cares

The chip-cash thing is really cool. Anyone else ever played Shadowrun? The futurecurrency in that setting is a PKI-based cryptocurrency stored on little flash drives. Payments between criminals and their contractors was thus untraceable Silk Road style while verifiable by checking the currency's publicly-auditable certificate chain. I wonder when PKI is going to become necessary for offline digital cash chips in the real world - certainly there's a desire for hacked cards?

Edit- actually, verification would require an internet connection :/

# ? Aug 15, 2016 12:15

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# ? May 12, 2024 23:59

ohgodwhat: Aug 6, 2005

Maybe you could call it something like coinbit, or bitcoin?

# ? Aug 15, 2016 12:50

GABA ghoul: Oct 29, 2011

Potato Salad posted:

The chip-cash thing is really cool. Anyone else ever played Shadowrun? The futurecurrency in that setting is a PKI-based cryptocurrency stored on little flash drives. Payments between criminals and their contractors was thus untraceable Silk Road style while verifiable by checking the currency's publicly-auditable certificate chain. I wonder when PKI is going to become necessary for offline digital cash chips in the real world - certainly there's a desire for hacked cards?

Edit- actually, verification would require an internet connection :/

I had to look it up in wikipedia, but that's more or less how it already works.

Every change to the card balance requires a signature. Increasing the balance requires a central authority certificate and an online connection(that's the part where you transfer money to the chip). Reducing the balance on the other hand can be done by any normal businesses, which have their own chip cards/software keys for signature(this part can happen offline). There is also all kind of authentication by both sides, customer chip and business chip, before the transaction goes through and all communication and saved data is encrypted.

The system is semi-anonymous because the business only gets a randomized transaction number at the end and it's not trackable for them. After the transaction is done they can go to a bank at any time and cash in all their saved transaction numbers at once.

Also, apparently the company running this system keeps a central shadow ledger for each chip where all transactions are collected as soon as possible, just as a general security measure if someone finds a way to gently caress around with the cards or balances. I guess that's the part where the "synchronisation" of all accounts with a central ledger happens, it's not instantaneous but probably not that much slower than bitcoin.

Yeah, all of this sounds suspiciously like Bitcoin, but less retarded ... and also two decades earlier ... and actually successful.

# ? Aug 15, 2016 14:41

Private Speech: Mar 30, 2011; I HAVE EVEN MORE WORTHLESS BEANIE BABIES IN MY COLLECTION THAN I HAVE WORTHLESS POSTS IN THE BEANIE BABY THREAD YET I STILL HAVE THE TEMERITY TO CRITICIZE OTHERS' COLLECTIONS

IF YOU SEE ME TALKING ABOUT BEANIE BABIES, PLEASE TELL ME TO

EAT. SHIT.

waitwhatno posted:

I had to look it up in wikipedia, but that's more or less how it already works.

...

Yeah, all of this sounds suspiciously like Bitcoin, but less retarded ... and also two decades earlier ... and actually successful.

The big problem with Bitcoin isn't the existence of a central ledger, it's that everyone needs to have a copy of it and all changes have to propagated across the network.

Which doesn't really scale past a certain point.

# ? Aug 15, 2016 14:54

GABA ghoul: Oct 29, 2011

Private Speech posted:

The big problem with Bitcoin isn't the existence of a central ledger, it's that everyone needs to have a copy of it and all changes have to propagated across the network.

Which doesn't really scale past a certain point.

I don't know that much about the inner workings of bitcoin, but my guess is that there are ten thousand ways to solve that problem by, for example, periodically pruning the blockchain or resetting it or something.

The real dilemma of Bitcoin is that it's a badly designed system with no competent oversight that could work around its faults.

# ? Aug 15, 2016 15:22

computer parts: Nov 18, 2010; PLEASE CLAP

Krispy Kareem posted:

Like, in China during the Olympics or just like all the time?

Because I like it imagine VISA spending every Olympics trying to push a lovely payment system on the host city in some vain decades long attempt to make VISA CASH a thing.

This was in 2015, so all the time. Though the only place I used them a lot was the airport, so it might've been just a legacy system there.

# ? Aug 15, 2016 15:26

Zudgemud: Mar 1, 2009; Grimey Drawer

Funnily enough I had two American guys in front of me at the inn yesterday that commented that in opposite from the states there were actually chip readers here for their cards.

In terms of China though, what are the safety nets regarding phone money transfers and is it tracked and taxed automatically for retailers?

# ? Aug 15, 2016 17:55

FrozenVent: May 1, 2009; The Boeing 737-200QC is the undisputed workhorse of the skies.

waitwhatno posted:

I don't know that much about the inner workings of bitcoin, but my guess is that there are ten thousand ways to solve that problem by, for example, periodically pruning the blockchain or resetting it or something.

The real dilemma of Bitcoin is that it's a badly designed system with no competent oversight that could work around its faults.

You can't prune the blockchain because it doesn't store account balances anywhere. So if someone hasn't used their bitcoins in five years, and you prune that... Welp those bitcoins are gone forever.

Bitcoin isn't badly designed, it's hilariously badly designed.

# ? Aug 15, 2016 20:40

Mozi: Apr 4, 2004; Forms change so fast
Time is moving past
Memory is smoke
Gonna get wider when I die; Nap Ghost

Not unlike certain aspects of the Chinese economy, one might venture.

# ? Aug 15, 2016 20:42

Fojar38: Sep 2, 2011; Sorry I meant to say I hope that the police use maximum force and kill or maim a bunch of innocent people, thus paving a way for a proletarian uprising and socialist utopia

also here's a stupid take
---------------------------->

Come to think of it isn't it kind of weird that all these articles are focusing on how great WeChat specifically is and how wonderful and innovative it is? This is starting to stink of a Tencent marketing campaign.

I've browsed the major articles I can find that aren't just republishing something that a larger paper put out and loving all of them are fellating WeChat like there's no tomorrow. Even up to the big outlets like the New York Times and Washington Post it's WeChat all the way down.

Edit: And on looking into some of the authors I find a bunch of tech CEO's with heavy investments in China lol

Fojar38 fucked around with this message at 23:32 on Aug 15, 2016

# ? Aug 15, 2016 23:28

Fojar38: Sep 2, 2011; Sorry I meant to say I hope that the police use maximum force and kill or maim a bunch of innocent people, thus paving a way for a proletarian uprising and socialist utopia

also here's a stupid take
---------------------------->

http://www.cnbc.com/2016/08/16/goldman-sachs-look-at-exports-and-commodities-to-judge-chinas-economic-transition.html

tl:dr; Goldman Sachs says that China's "economic transition" must be going swell because instead of exporting really cheap poo poo as the basis for their entire economy, they are now exporting slightly more expensive poo poo as the basis for their entire economy.

Also ignore investment-to-GDP and China's freefalling manufacturing sector because those are "old economy" and therefore irrelevant.

Goldman Sachs still masters of financial analysis

# ? Aug 16, 2016 20:31

TheBuilder: Jul 11, 2001

The best thing about wechat is that whenever a blockbuster Hollywood film is released in China, I can watch the whole loving thing in my moments (news) feed because everyone has to share those 8 seconds of them watching the movie.

# ? Aug 17, 2016 01:55

My Imaginary GF: Jul 17, 2005; by R. Guyovich

TheBuilder posted:

The best thing about wechat is that whenever a blockbuster Hollywood film is released in China, I can watch the whole loving thing in my moments (news) feed because everyone has to share those 8 seconds of them watching the movie.

Sounds like it's forever 1993 in China, what with how in vogue conspicuous consumption became in the Russian federation.

Also, no loving manners. If your citizens can't keep their cellphones off in your theatres, you don't deserve to be called a nation-state.

# ? Aug 17, 2016 01:57

Fojar38: Sep 2, 2011; Sorry I meant to say I hope that the police use maximum force and kill or maim a bunch of innocent people, thus paving a way for a proletarian uprising and socialist utopia

also here's a stupid take
---------------------------->

China should be invaded and the CCP overthrown for that reason alone

# ? Aug 17, 2016 02:11

Grand Fromage: Jan 30, 2006; L-l-look at you bar-bartender, a-a pa-pathetic creature of meat and bone, un-underestimating my l-l-liver's ability to metab-meTABolize t-toxins. How can you p-poison a perfect, immortal alcohOLIC?

TheBuilder posted:

The best thing about wechat is that whenever a blockbuster Hollywood film is released in China, I can watch the whole loving thing in my moments (news) feed because everyone has to share those 8 seconds of them watching the movie.

Or three nine picture posts of different scenes in the movie with no context or anything.

# ? Aug 17, 2016 04:10

My Imaginary GF: Jul 17, 2005; by R. Guyovich

Fojar38 posted:

China should be invaded and the CCP overthrown for that reason alone

Let the savages eat themselves. They've had, what, one blockbuster between 2000 and 2010, right? Meanwhile Transformers S4: SFX FUCKYEAH seems to run as wild at their boxoffice as Kennedy at a pair of twins' highschool graduation party.

# ? Aug 17, 2016 05:59

namaste friends: Sep 18, 2004; by Smythe

https://twitter.com/gregorhunter/status/767532744142229504?s=09

# ? Aug 22, 2016 03:17

Fojar38: Sep 2, 2011; Sorry I meant to say I hope that the police use maximum force and kill or maim a bunch of innocent people, thus paving a way for a proletarian uprising and socialist utopia

also here's a stupid take
---------------------------->

I haven't found any news outlet talking about that.

# ? Aug 22, 2016 05:52

namaste friends: Sep 18, 2004; by Smythe

https://twitter.com/lisaabramowicz1/status/767888570795327488?s=09

# ? Aug 23, 2016 02:49

namaste friends: Sep 18, 2004; by Smythe

http://voxeu.org/article/why-banking-crisis-china-seems-unavoidable

quote:

Why a banking crisis in China seems unavoidable

Edoardo Campanella, Daniel Vernazza

27 September 2016
China�s debt � in particular its corporate debt � is large by historical and international standards. This column argues that of greater concern is the sharp increase in recent years, and that the vulnerability is heightened by the concentration of this debt in old industries that suffer from overcapacity and weak competitiveness. The authorities appear to be only now taking steps to halt the rise in corporate debt, but as prior episodes of banking crises show, this is unlikely to be enough to avert either a prolonged period of slowing growth or a financial crisis in the medium term.

A few weeks ago, official Chinese media announced that the government will carry out a debt-for-equity swap for the debt held by its state-owned banks in struggling companies, starting as soon as mid-September.1 The aim is to reduce China�s rising corporate debt, which at 171% of GDP is more than twice as high as that in the US. It is a policy the country used back in 1999 amid rising bad debts, but this time around the Chinese economy�s vulnerabilities are much greater.

This matters not only for China but for the rest of the world and global markets too. China contributes roughly one-third of global GDP growth, and the IMF estimates that more than a third of equity and FX price moves in advanced countries are driven by news from China and other emerging markets (IMF 2016a). Prominent examples are the turmoil in global financial markets in August last year and January this year, both of which originated from downside news out of China. And it was no surprise that in its recently released Article IV report on China, the IMF warned Beijing to take concrete and immediate action to address its corporate debt problem (IMF 2016b).

The big question is how close is China to the outbreak of a financial crisis. By referring to early warning indicators and previous episodes of banking crises, we show that China has entered a danger zone. Without bold and swift government action, a crisis seems more likely than not.

Mind the gap
A small but growing academic literature has shown that the credit-to-GDP ratio relative to its long-term trend (the so-called �credit-to-GDP gap�) is the best single early warning indicator of financial crises (BCBS 2010).2 Credit is broadly defined as credit to the private non-financial sector (households and non-financial corporations) and includes non-bank and foreign funding. Figure 1 shows this measure for a number of advanced and emerging markets at the end of 2015, where we have focused on those countries reporting to the BIS whose credit-to-GDP gap is greater than zero. China tops the list.

The natural question then is what level of credit-to-GDP gap signals a high probability of a future financial crisis? To get an idea, Figure 2 plots the credit-to-GDP gap in the quarter preceding nine severe banking crises. These are: Norway (1990), Sweden (1991), Finland (1991), Japan (1992), Mexico (1994), UK (2007), US (2007), Ireland (2008), and the Netherlands (2008).3 In many cases, the credit-to-GDP gap exceeded 8 prior to the onset of a severe financial crisis. In fact, the empirical literature suggests that a credit-to-GDP gap in excess of 8 is the danger zone (BCBS 2010). In China today, the ratio is at 30.

It�s important to add that while the credit-to-GDP ratio is a good predictor of banking crises, it does not pin down the exact timing. The ratio can remain high for years before a crisis actually takes hold � if at all. Figure 3 shows the evolution of the indicator in the 32 quarters before the outbreak of a crisis for our sample of severe financial crises. From the figure, we see the build-up in the credit-to-GDP gap ahead of the crisis, but in some cases it eases (albeit from high levels) before the crisis actually starts and so it is hard to identify a trigger point.

Although predicting the exact timing of a crisis is impossible, other indicators signal that vulnerabilities in the financial sector are mounting and are close to critical thresholds. First, debt service ratios (the ratio of interest payments plus amortisations to income) are 20% higher than the ratio in the US at the onset of the 2007/8 subprime crisis. Second, house prices have been rising very strongly, fuelled by a frenzy of borrowing, and this increases the exposure of the economy to a sudden drop in real estate prices. Third, a big chunk of credit goes to the old economy, where profitability and cash flows are slowing.

Not surprisingly, amid industrial overcapacity and a slowing economy, non-performing loans (NPLs) of the commercial banking sector are rising. Officially, they amount to just 1.7% of total loans.4 But, these figures likely substantially underestimate the scale of bad debts. Unlike the vast majority of countries in the world, loans that are 90 days past due are not considered non-performing by China if the expected market value of collateral secured on the loan is higher than the loan itself. If we include so-called special mention loans (loans which are overdue but not yet considered non-performing), then the ratio would increase to 5.8% of outstanding bank loans, up from 3.5% at the start of 2014. And, the actual bad loans figure could be much higher, especially if one takes into account the �evergreening� practice of rolling over debt where new credit is used to service existing loans.

Assuming the �true� level of NPLs is 5.8%, and given total outstanding bank loans are $12.3 trillion, then potential bad debts would equal $0.7 trillion, or 6.5% of China�s GDP, which is substantial for an emerging economy.

Bold government action is needed
As previous episodes of banking crises show, the sharp build-up of credit in the Chinese economy suggests a very high probability of a crisis in the next few years. Whether a crash can be avoided or not depends critically on the policy response of the Chinese government. In the three major banking crises that hit the country in the 1980s and 1990s, the one-party state was extremely willing to absorb part of the private sector losses. It now needs to act quickly to reduce corporate debt, strengthen bank balance sheets, and move the economy away from credit-fuelled investment in the �old economy� and towards consumption. Debt-for-equity swaps, bank recapitalisations and the establishment of a market for the NPLs are all options on the table. Such a restructuring process of the banking system would result in a period of slower growth due to the credit contraction, but it would lead to a more sustainable growth model in the medium term. If, instead, the government continues to promote rampant credit growth, forcing banks to keep alive struggling state-owned enterprises, misallocating resources and deferring the necessary structural rebalancing, then a crash would seem to be unavoidable.

namaste friends fucked around with this message at 05:23 on Oct 2, 2016

# ? Oct 2, 2016 05:20

namaste friends: Sep 18, 2004; by Smythe

Ubs just noped the gently caress out of taking Dalian Wanda private because of "compliance"

quote:

MENU

Financial Times

MYFT

Dalian Wanda Group Add to myFT

UBS exited Wanda deal over compliance

Swiss bank was uncomfortable with structure of $4.4bn transaction

© Reuters

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10

OCTOBER 8, 2016

by: Don Weinland and Jennifer Hughes in Hong Kong

UBS walked away from a $4.4bn deal to take a Dalian Wanda unit into private ownership despite initially proposing the move, clearing the way for a rival Chinese bank to take the lead financial adviser role.

UBS withdrew from the take-private of Wanda’s commercial properties business after it became uncomfortable with the structure of the transaction, according to people close to the matter.

Hong Kong rules require banks to be satisfied with the sources and availability of funds when offers are made.

Wanda also approached at least one other foreign bank about working on the deal but was turned down, leaving China’s CICC to run the process single-handedly.

The company — owned by billionaire Wang Jianlin, China’s second-richest man — has become one of the country’s most widely known conglomerates, having made international acquisitions including AMC cinemas and Hollywood studio Legendary Entertainment. It recently initiated talks to buy Dick Clark Productions for a reported $1bn.

A senior Wanda official, who declined to be identified, said UBS had become uncomfortable with the deal’s credit-risk profile and dropped the transaction that it had originally proposed. “That’s why foreign banks are really losing ground on this front,” the Wanda official said.

When Wanda listed in Hong Kong two years earlier, HSBC and CICC sponsored the $3.7bninitial public offering and UBS, Goldman Sachs and CICC were lead bookrunners.

UBS’s discomfort upset Wanda, people close to the matter said, but it was ultimately the Swiss bank’s decision to remove itself from the deal just before the offer was made to shareholders.

CICC did not respond to requests for comment. UBS declined to comment.

https://www.ft.com/content/86731ee4-8bad-11e6-8aa5-f79f5696c731

I wonder what they found???????

# ? Oct 9, 2016 17:51

Switzerland: Feb 18, 2005; Do what thou must do.

namaste faggots posted:

Ubs just noped the gently caress out of taking Dalian Wanda private because of "compliance"

https://www.ft.com/content/86731ee4-8bad-11e6-8aa5-f79f5696c731

I wonder what they found???????

No whys, that's for sure!

# ? Oct 10, 2016 00:49

mila kunis: Jun 10, 2011

Fojar38 posted:

Come to think of it isn't it kind of weird that all these articles are focusing on how great WeChat specifically is and how wonderful and innovative it is? This is starting to stink of a Tencent marketing campaign.

I've browsed the major articles I can find that aren't just republishing something that a larger paper put out and loving all of them are fellating WeChat like there's no tomorrow. Even up to the big outlets like the New York Times and Washington Post it's WeChat all the way down.

Edit: And on looking into some of the authors I find a bunch of tech CEO's with heavy investments in China lol

I know you're the type that has to jump on anything remotely affiliated with China but wechat is actually pretty good. I think facebook messenger is moving to catch up with them feature wise.

# ? Oct 10, 2016 03:40

namaste friends: Sep 18, 2004; by Smythe

wrong thread

# ? Oct 10, 2016 05:34

computer parts: Nov 18, 2010; PLEASE CLAP

tekz posted:

I know you're the type that has to jump on anything remotely affiliated with China but wechat is actually pretty good. I think facebook messenger is moving to catch up with them feature wise.

There were a lot of features there that only got added to other (Western) messaging clients later, like short audio recordings or stickers.

# ? Oct 10, 2016 15:03

Koramei: Nov 11, 2011; I have three regrets
The first is to be born in Joseon.

My impression is that most of wechat is just cribbed from Line and Kakao.

which are themselves trying to become facebook-lights. It's just one big circle of taking everyone else's ideas in the social media industry.

# ? Oct 10, 2016 17:45

Grand Fromage: Jan 30, 2006; L-l-look at you bar-bartender, a-a pa-pathetic creature of meat and bone, un-underestimating my l-l-liver's ability to metab-meTABolize t-toxins. How can you p-poison a perfect, immortal alcohOLIC?

Basically, though I think WeChat has more functions than Kakao now. I don't use Line.

WeChat is the most impressively garbage program I've ever seen though. For an example, when you send or receive an emoji/sticker/picture, the program saves an instance of it. It saves a new instance every single time. These are buried in a hidden folder deep in the program, and there's no automatic way to clear it. This gradually eats all the storage in your phone unless you format your phone or dig through your files enough to discover the folder and delete it.

Grand Fromage fucked around with this message at 12:50 on Oct 11, 2016

# ? Oct 11, 2016 12:47

Krispy Wafer: Jul 26, 2002; I shouted out "Free the exposed 67"
But they stood on my hair and told me I was fat; Grimey Drawer

tekz posted:

I know you're the type that has to jump on anything remotely affiliated with China but wechat is actually pretty good. I think facebook messenger is moving to catch up with them feature wise.

I don't know if anyone is saying WeChat is bad or that it's not ahead of other Western messaging systems.

But it's not something to emulate. It's kind of janky, it's services offered don't necessarily translate well to developed countries, and if you're going to ape another country's tech, don't pick the highly totalitarian, closed marketplace with massive amounts of state funding to limit competition. We still don't know if China's best startups are succeeding despite of or because of China's government.

# ? Oct 11, 2016 13:37

Morrow: Oct 31, 2010

computer parts posted:

There were a lot of features there that only got added to other (Western) messaging clients later, like short audio recordings or stickers.

This would explain why my chinese friends are the only people who use those audio snippets.

# ? Oct 11, 2016 18:40

namaste friends: Sep 18, 2004; by Smythe

https://twitter.com/WorthWray/status/786007683539177472?s=09

This Chinese debt bubble can't be bailed out by reserves can it?

# ? Oct 12, 2016 03:37

namaste friends: Sep 18, 2004; by Smythe

http://mobile.nytimes.com/2016/10/17/business/international/china-home-price-bubble.html?smid=tw-share&referer=https://t.co/u5uFtrHd1P

quote:

China Property Boom Spurs Fear of Bubble�s Burst

SHANGHAI � Zheng Ruizhen counted herself among the last holdouts on Lufeng Road.

Even as high-rises sprang up in recent years to surround her dilapidated home, Ms. Zheng, a 50-year-old schoolteacher, and her husband, Sun Guojian, held firm. He grew up there. Her school was a 20-minute bicycle ride away. They raised their son there, though he eventually grew so tall that his head grazed the ceiling of his cramped room. When city officials pushed them to sell, they said no.

Then came China�s latest property bubble � a frothy surge in prices that could have global repercussions if it pops.

In August, an unremarkable piece of land around the corner from Ms. Zheng sold for nearly $2,000 a square foot, a national record and nearly three times the average land price in Manhattan. Local officials grew more insistent and threatened to tear down their bathroom.

Finally, they relented, and Ms. Zheng�s husband signed away the home for a price to be determined later. Then, on Oct. 9, Mr. Sun died of a heart attack, something Ms. Zheng said was perhaps influenced by stress over the pending demolition of their home.

Now, as she grieves, she is waiting to hear how much the Shanghai government will offer in compensation � but however much that is, she knows it will not be enough for her to be able to afford to live anywhere close to Lufeng Road.

Said Ms. Zheng: �I never expected housing prices in Shanghai would get this high.�

China is in the midst of a dizzying housing bubble. Shanghai�s average housing price is up nearly one-third from a year ago, with prices in major cities like Beijing and Guangzhou not far behind. Chinese consumers are rushing to buy homes before the government steps in with restrictions.

When rumors swept through Shanghai that the government would require homeowners to pay more in taxes and down payments to buy additional properties, many couples filed for divorce so that one partner could still be treated as an independent buyer.

China has experienced housing booms and busts before. And fervor for real estate among the wealthiest Chinese has already spread far beyond the country�s borders, from Long Island mansions to disused ranches in Texas � many to get their money out of the country.

But economists warn that the current boom on the Chinese mainland could be extra difficult to resolve: It comes with a growing amount of American-style debt.

Long-term household loans � mostly mortgages � have doubled as a share of total official bank lending this year. They accounted for about 40 percent of all new loans in August, contrasted with just 20 percent at the start of the year. The value of new home loans as a percentage of all housing sales has surged to a record high.

The loans � largely a byproduct of a flood of Chinese lending to keep the economy growing � are helping the affluent, the middle class and low earners who have dreamed of owning a home, while investors and speculators are piling in, too. Underground lenders � those who operate outside the formal banking system using a variety of new platforms � are also helping to feed the boom.

Last month, economists at the Bank of China warned in a report that worsening asset price bubbles were adding to a frothy market that could result in trouble. The day before, Wang Jianlin, a politically connected property and entertainment magnate who is one of the country�s richest people, told CNN that China property was �the biggest bubble in history.�

That could be bad news for the global economy. Many economists estimate that housing and related areas � like construction, cement manufacturing or furniture making � account for roughly one-fifth of China�s economic activity. But if the bubble pops, that support could disappear quickly.

Chinese officials, apparently mindful of the 2008 American housing bust, appear to be aware of the risks of a debt-fueled property bubble. But some economists worry they will be too slow to rein it in.

�The risk is that the government is late in cooling the market, the rally spreads to more areas, pushing up household leverage and construction activity, pushing the bubble bigger, which is then followed by a bigger downward correction,� said Tao Wang, the head of China economics at UBS in Hong Kong.

Local regulators are already trying to cool things down. In the last few weeks, local authorities have accelerated efforts to tighten housing markets in up to 20 Chinese cities, according to economists at China International Capital Corporation, an investment bank.

But in many cases these steps have only added to the rush, as home buyers move in while they can.

By her account, Zhang Xia and her husband have enjoyed a happy marriage. Then the rumor swept the city that Shanghai authorities would make it harder for couples with one home to buy more.

On a recent Monday, Ms. Zhang, a 40-year-old resident of Shanghai�s Huangpu area, and her husband sat waiting at a local marriage registry office to file for divorce. Shanghai officials continue to deny that they will limit house buying by couples, but Ms. Zhang is among many who do not believe them.

�We know the government said this is a rumor, but they also said that a few times before, when the rumor actually came true,� Ms. Zhang said. �Some people even said the fact that the government said it�s a rumor means it�s going to be true.�

Shanghai, China�s financial capital, is at the heart of the property boom. Demand there is so intense that developers now commonly require sizable deposits of cash just to join a lottery to buy a new apartment. Only holders of winning numbers will be offered the chance to buy a unit. One flashy new development in central Shanghai charges a refundable 200,000 renminbi, or $30,000, to enter its lottery.

�In Shanghai now,� said Wang Jie, a sales manager there, �it�s not like you can buy an apartment just because you have money.�

Back on Lufeng Road, the recently widowed Ms. Zheng and her neighbors try to go about their lives despite the boom going on around them. Men and women play mah-jongg near a half-demolished house, one of a number of dwellings along the road in various states of disassembly, like a row of rotting teeth. Stray dogs sunbathe and alley cats hunt around piles of red bricks and wooden beams scattered on the street.

In recent months, local officials hung red propaganda banners on people�s housing extolling the benefits of selling out. �No more hesitation means no more disappointment,� reads one. Says another: �Requisition and compensation are lawful. Smart alecks will regret it later.�

�Look at those banners,� Ms. Zheng said, shaking her head. �It�s almost like the Cultural Revolution once again.�

Earlier, local officials told Ms. Zheng that the land where her home stands would be used to build supporting facilities for the next-door complex of high-rises built by China Vanke, the country�s largest property developer.

�They said that when people who live in the high-rises in Vanke look down, the view from their windows is our ugly roofs,� she said. �So they have to get rid of us.�

# ? Oct 17, 2016 04:07

Potato Salad: Oct 23, 2014; nobody cares

CHINA BUBBLE GONNA BURST!

--Some Guy 10 years ago

E - “We know the government said this is a rumor, but they also said that a few times before, when the rumor actually came true,” Ms. Zhang said. “Some people even said the fact that the government said it’s a rumor means it’s going to be true.”

:psylon:

# ? Oct 17, 2016 15:38

Fojar38: Sep 2, 2011; Sorry I meant to say I hope that the police use maximum force and kill or maim a bunch of innocent people, thus paving a way for a proletarian uprising and socialist utopia

also here's a stupid take
---------------------------->

Potato Salad posted:

CHINA BUBBLE GONNA BURST!

--Some Guy 10 years ago

"This time it's different! Things are just gonna go up and up indefinitely, because they have continued to do so up to this point!"

- Idiots during every bubble ever

# ? Oct 17, 2016 22:21

namaste friends: Sep 18, 2004; by Smythe

https://twitter.com/izakaminska/status/788252779592687616?s=09

lol here we go again

# ? Oct 18, 2016 06:47

icantfindaname: Jul 1, 2008

they were supposed to revive the A shares, not the B shares!

# ? Oct 18, 2016 07:42

Beamed: Nov 26, 2010; Then you have a responsibility that no man has ever faced. You have your fear which could become reality, and you have Godzilla, which is reality.

computer parts posted:

There were a lot of features there that only got added to other (Western) messaging clients later, like short audio recordings or stickers.

I officially feel old for remembering when MSN had these at least years ago. :smith:

# ? Oct 29, 2016 19:31

Krispy Wafer: Jul 26, 2002; I shouted out "Free the exposed 67"
But they stood on my hair and told me I was fat; Grimey Drawer

So what are the worldwide repercussions when the bubble bursts? Certainly no one is buying securitized China mortgage debt outside of their own country.

I guess a collapse could gently caress with other countries' manufacturing as China floods world markets with a rock bottom Yuan.

# ? Nov 1, 2016 02:56

fishmech: Jul 16, 2006; by VideoGames; Salad Prong

Krispy Kareem posted:

So what are the worldwide repercussions when the bubble bursts? Certainly no one is buying securitized China mortgage debt outside of their own country.

I guess a collapse could gently caress with other countries' manufacturing as China floods world markets with a rock bottom Yuan.

It'll majorly hurt all the countries that rely heavily on exports and imports with China. That's why most of those are signing onto the TPP to reduce exposure to China.

# ? Nov 1, 2016 03:07

Accretionist: Nov 7, 2012; I BELIEVE IN STUPID CONSPIRACY THEORIES

A commodity prices collapse would ruin anyone involved in commodities. China consumes hard-to-describe volumes of raw materials.

For example, they used more cement in three years than we used in one-hundred.

From 1901 to 2000, the United States used 4.5 gigatons of cement. In 100 years, 4.5 gigatons.

From 2011 to 2013, China used 6.6 gigatons of cement. In 3 years, 6.6 gigatons.

It's like that for a lot of things.

# ? Nov 1, 2016 15:02

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# ? May 12, 2024 23:59

Krispy Wafer: Jul 26, 2002; I shouted out "Free the exposed 67"
But they stood on my hair and told me I was fat; Grimey Drawer

I guess I'm trying to gauge the extent of damage. Countries that rely heavily on China's imports or their loans are obviously going to suffer, but it sounds like it'd be more a repeat of the late 90's Asian crisis rather than another 2008 financial collapse. Except you'd probably see more problems in Africa and South America where China has been peddling influence.

Then again, Western banks and corporations do some pretty boneheaded things (WaMu, BoA, Iceland, Trump Mortgage in 2007). I wouldn't put it past some huge 'too big to fail' institution inexplicably holding a lot of Chinese debt when the music finally stops.

Watch oil and commodity prices finally recover only to see China poo poo itself and start the whole mess over again.

# ? Nov 1, 2016 15:22

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