China Economy Megathread

The Something Awful Forums > Discussion > Debate & Discussion > China Economy Megathread

J. P. Beagley: Apr 11, 2008

Cultural Imperial posted:

Lol

https://twitter.com/n_gough/status/712161418712190977?s=09

"We have the equivalent of $25,000,000,000 USD (25 BILLION United States dollars) in our reserves that cannot be moved without your help. We will send you the $25,000,000,000 USD and when you send it back to us you can keep 20% (1,250,000,000) as transaction fee. I am absolutely positive that this arrangement will be of mutual benefit to both of us and I think that it is of utmost importance that you reach me through my personal email address stating your telephone and fax numbers and I would give you a telephone call to discuss the matter further and if we reach an acceptable arrangement, then we can proceed further."

# ? Mar 26, 2016 02:19

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# ? May 26, 2024 21:03

Dux Supremus: Feb 2, 2009

StandardVC10 posted:

IIRC it's a An-24 clone but with Pratt and Whitney Canada engines and new avionics or something like that.

I was wondering why engine failure wasn't on the list of problems the WSJ found. Welp.

# ? Mar 26, 2016 13:31

The MUMPSorceress: Jan 6, 2012; ^SHTPSTS; Gary’s Answer

Krispy Kareem posted:

Maybe I'm missing something, but it didn't seem to be that bad. Some language issues, some cultural issues, some food issues.

They were sent on an expenses-paid vacation so they wouldn't see the slow part* of production.

*The part where all the tiny children come in and work for 16 hours a day handmaking their poo poo.

# ? Mar 28, 2016 21:39

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
---------------------------->

So I was perusing the CIA World Factbook today and saw that there was a note next to China's official exchange rate GDP saying

"because China's exchange rate is determined by fiat, rather than by market forces, the official exchange rate measure of GDP is not an accurate measure of China's output; GDP at the official exchange rate substantially understates the actual level of China's output vis-a-vis the rest of the world; in China's situation, GDP at purchasing power parity provides the best measure for comparing output across countries"

This runs in contradiction to everything that I have heard about exchange rate vs PPP calculations for GDP. I always thought that PPP was only useful for measuring the domestic purchasing power of a given country and wasn't particularly useful for cross-country comparisons, particularly countries with massive differences in population and income. That said I hadn't considered that the nature of the Chinese currency being controlled by the government might influence its exchange rate GDP, although if the government controls the exchange rate how useful is an exchange rate measure at all? Wouldn't that mean that it would be whatever the CCP wanted it to be at any given moment?

I don't understand economics very well and have been trying to wrap my head around all these measures of economic output for a few days now, and the only conclusion I have been able to arrive at is that every economist has a different opinion about everything. What's the deal with this CIA note? Does it mean that China's "real" economy is it's PPP economy?

Or does this mean that literally nobody knows how large or small the Chinese economy is with any meaningful precision?

# ? Apr 11, 2016 21:10

CommieGIR: Aug 22, 2006; The blue glow is a feature, not a bug; Pillbug

Fojar38 posted:

So I was perusing the CIA World Factbook today and saw that there was a note next to China's official exchange rate GDP saying

"because China's exchange rate is determined by fiat, rather than by market forces, the official exchange rate measure of GDP is not an accurate measure of China's output; GDP at the official exchange rate substantially understates the actual level of China's output vis-a-vis the rest of the world; in China's situation, GDP at purchasing power parity provides the best measure for comparing output across countries"

This runs in contradiction to everything that I have heard about exchange rate vs PPP calculations for GDP. I always thought that PPP was only useful for measuring the domestic purchasing power of a given country and wasn't particularly useful for cross-country comparisons, particularly countries with massive differences in population and income. That said I hadn't considered that the nature of the Chinese currency being controlled by the government might influence its exchange rate GDP, although if the government controls the exchange rate how useful is an exchange rate measure at all? Wouldn't that mean that it would be whatever the CCP wanted it to be at any given moment?

I don't understand economics very well and have been trying to wrap my head around all these measures of economic output for a few days now, and the only conclusion I have been able to arrive at is that every economist has a different opinion about everything. What's the deal with this CIA note? Does it mean that China's "real" economy is it's PPP economy?

Or does this mean that literally nobody knows how large or small the Chinese economy is with any meaningful precision?

Exactly what it means. And it's part of the issue, China has been both artificially inflating it's GDP growth while devaluing it's currency, but the market is calling it on it and it's gonna hurt.

# ? Apr 11, 2016 21:46

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
---------------------------->

So to make sure I understand it correctly, China has been inflating its real GDP growth rate, which means that China's economy should be smaller than what's reported, but on the other hand, it keeps its currency artificially low, which means that that China's economy should be larger than what's reported as implied by that CIA factbook note?

Is that note there because due to having a fixed currency, the Chinese government can make their exchange rate gdp whatever they want simply by devaluing or appreciating the currency however they want, thereby making the designation meaningless?

# ? Apr 11, 2016 22:07

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

Fojar38 posted:

So to make sure I understand it correctly, China has been inflating its real GDP growth rate, which means that China's economy should be smaller than what's reported, but on the other hand, it keeps its currency artificially low, which means that that China's economy should be larger than what's reported as implied by that CIA factbook note?

Is that note there because due to having a fixed currency, the Chinese government can make their exchange rate gdp whatever they want simply by devaluing or appreciating the currency however they want, thereby making the designation meaningless?

I'm not sure why China's currency manipulation would cause China's economy to be larger than whats reported.

I think there are several issues which are clear when it comes to China:

1. China has an economy

2. China has a currency

3. No why

But seriously, deflation is a regressive tax which redistributes wealth from debtors to creditors while inflation is a progressive tax which redistributes wealth from creditors to debtors. China's economy would grow if communist officials were to engage in a form of taxation as reliable as inflation. The problem with China is regulation, as regulations are just excuses for bribes, and the only way to fix this is to have a two-party system.

# ? Apr 11, 2016 23:00

icantfindaname: Jul 1, 2008

Fojar38 posted:

So I was perusing the CIA World Factbook today and saw that there was a note next to China's official exchange rate GDP saying

"because China's exchange rate is determined by fiat, rather than by market forces, the official exchange rate measure of GDP is not an accurate measure of China's output; GDP at the official exchange rate substantially understates the actual level of China's output vis-a-vis the rest of the world; in China's situation, GDP at purchasing power parity provides the best measure for comparing output across countries"

This runs in contradiction to everything that I have heard about exchange rate vs PPP calculations for GDP. I always thought that PPP was only useful for measuring the domestic purchasing power of a given country and wasn't particularly useful for cross-country comparisons, particularly countries with massive differences in population and income. That said I hadn't considered that the nature of the Chinese currency being controlled by the government might influence its exchange rate GDP, although if the government controls the exchange rate how useful is an exchange rate measure at all? Wouldn't that mean that it would be whatever the CCP wanted it to be at any given moment?

I don't understand economics very well and have been trying to wrap my head around all these measures of economic output for a few days now, and the only conclusion I have been able to arrive at is that every economist has a different opinion about everything. What's the deal with this CIA note? Does it mean that China's "real" economy is it's PPP economy?

Or does this mean that literally nobody knows how large or small the Chinese economy is with any meaningful precision?

I'm not an economist but I know the currency undervaluing is not nearly as bad as is often made out, certainly it's much less pronounced than with Japan in the high postwar years of the 60s and 70s. China has actually taken substantial steps to float their currency in recent years. And on top of that I suspect the effect of exchange rates on GDP is a lot smaller than that note makes it out as. I would lean towards the note being there to avoid hurt Chinese feelings. It's probably a measurable effect but not very significant. Normal GDP is still the proper measurement for cross-country comparison

And also the last thing you said is also true

icantfindaname fucked around with this message at 23:29 on Apr 11, 2016

# ? Apr 11, 2016 23:26

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

icantfindaname posted:

And also the last thing you said is also true

The Chinese economy is precisely as large and as small as whatever does not hurt the feelings of the Chinese peoples and their 56 flavors of minorities.

# ? Apr 12, 2016 00:13

OXBALLS DOT COM: Sep 11, 2005; by FactsAreUseless; Young Orc

My Imaginary GF posted:

The Chinese economy is precisely as large and as small as whatever does not hurt the feelings of the Chinese peoples and their 56 flavors of minorities.

Lol if you think anyone in the Chinese government gives a single poo poo about minorities beyond how to get rid of them

# ? Apr 12, 2016 00:17

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

Fojar38 posted:

Or does this mean that literally nobody knows how large or small the Chinese economy is with any meaningful precision?

There have been concerns about China inflating their GDP for awhile. Maybe it was national pride, as they claim to have surpassed Japan to be the second largest economy.

http://money.cnn.com/news/economy/world_economies_gdp/

That's assuming China's numbers are anywhere near accurate. It's possible their real GDP is as little as half what they post.

# ? Apr 12, 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
---------------------------->

Krispy Kareem posted:

There have been concerns about China inflating their GDP for awhile. Maybe it was national pride, as they claim to have surpassed Japan to be the second largest economy.

http://money.cnn.com/news/economy/world_economies_gdp/

That's assuming China's numbers are anywhere near accurate. It's possible their real GDP is as little as half what they post.

Why do I get the feeling that nearly all Chinese growth past 2009 is from stimulus

# ? Apr 12, 2016 02:14

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

Mange Mite posted:

Lol if you think anyone in the Chinese government gives a single poo poo about minorities beyond how to get rid of them

About as much as I think the Zhang family gives a poo poo about hurting the feelings of the Chinese peoples.

# ? Apr 12, 2016 05:47

namaste friends: Sep 18, 2004; by Smythe

https://twitter.com/AP/status/720794737414942720

welp

# ? Apr 15, 2016 03:22

whatever7: Jul 26, 2001; by LITERALLY AN ADMIN

Has anyone proposed an economic theory that the closer China get to US's economic size, the closer China's growth is to the US?

# ? Apr 15, 2016 03:40

namaste friends: Sep 18, 2004; by Smythe

https://twitter.com/BaldingsWorld/status/720804549972234241

lmao

# ? Apr 15, 2016 03:50

namaste friends: Sep 18, 2004; by Smythe

http://www.ft.com/fastft/2016/04/15/chinese-data-fails-to-inspire-asian-markets/?ft_site=falcon&desktop=true

quote:

Investors appeared fatigued at the end of a strong week, with a decent set of economic data from China struggling to boost Asian markets on Friday.

China�s economy grew 6.7 per cent year-on-year during the March quarter, in line with expectations, but easing a tenth of a percentage point from the final three months of 2015. It was the slowest rate of quarterly growth since the first three months of 2009, but still sits in the range of Beijing�s full-year growth target of 6.5 to 7 per cent.

There were encouraging signs in other March data, with growth in industrial production, retail sales and fixed asset investment all coming in ahead of economists� expectations. This added to better-than-expected trade numbers for March, released on Tuesday.

But it all had a limited impact on markets today. The Shanghai Composite was down 0.2 per cent, while the technology-focused Shenzhen Composite was off a quarter of a percentage point. Hong Kong�s Hang Seng was 0.1 per cent lower, while the Hang Seng China Enterprises Index, a gauge of mainland companies listed in Hong Kong, was down a third of a percentage point.

Other China-exposed assets fared better, including the Australian dollar, which gained as much as 0.4 per cent, and its New Zealand counterpart, which jumped as much as 0.6 per cent. Australia�s S&P/ASX 200 was up 0.4 per cent.

Japanese shares were on track to end their first three-day winning streak in a month, with the broad Topix index 0.7 per cent lower and the narrower Nikkei 225 down by 0.3 per cent.

However, strong mid-week gains meant the two benchmarks were poised for their best weekly performance since mid-February, up by 5.8 per cent and 6.5 per cent, respectively.

Also providing some relief has been the weaker yen, which slid for a fourth day in a row, down a quarter of a percentage point at Y109.68 per dollar and on track for its biggest weekly drop � of 1.5 per cent � since the final week of January.

The dollar index, a measure of the US currency against a basket of global peers, was up 0.1 per cent on Friday at 94.96, eyeing its fourth consecutive day of gains.

Oil has been another major feature of trading, but prices have been shaky since strong gains on Tuesday. Brent crude, the international benchmark, was up 0.3 per cent on Friday to $43.97 a barrel, while West Texas Intermediate, the US marker, was 0.4 per cent firmer at $41.65.

Investors are turning their attention to a meeting in Doha this weekend where major producers are expected to agree to freeze output at January levels.

The International Energy Agency overnight poured some cold water on the situation, saying in a report that �If there is to be a production freeze, rather than a cut, the impact on physical oil supplies will be limited.�

Since hitting 12-year lows below $30 a barrel at the start of this year, oil prices have recovered by more than half.

Base metals have had a good performance this week, although prices were mixed on Thursday. So far this week, the London Metal Exchange index has risen 3.7 per cent and on track for its best advance since the first week of March. Gold was up 0.1 per cent at $1,229.26 an ounce on Friday, but was heading for a weekly decline.

The bounce in oil prices earlier this week, as well as the better-than-expected Chinese trade data have prompted a broad exit from the haven assets, such as government bonds, which have sold off this week. An exception has been Japanese government bonds, which have continued to rally.

The Singapore dollar was 0.2 per cent stronger today, recovering ground after the city state�s central bank unexpectedly eased monetary policy on Thursday and trimmed its growth outlook.

Overnight, Wall Street edged to a 2016 high, with the S&P 500 climbing 0.02 per cent.

# ? Apr 15, 2016 04:19

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
---------------------------->

So with 6.7% officially, China's actual growth rate is probably 3.7% huh

Cultural Imperial posted:

https://twitter.com/BaldingsWorld/status/720804549972234241

lmao

lol or it's 6.7% by means of writing down lovely loans

# ? Apr 15, 2016 04:29

I would blow Dane Cook: Dec 26, 2008

quote:

Chinese brokers are using attractive female analysts to tout stocks online

China�s biggest brokerage houses are using online videos and live streams of attractive, female analysts to tout stocks�and China�s regulators don�t like it.
The Shanghai and Beijing branches of China�s top securities regulator have issued notices to brokerages under their jurisdiction, financial media house Caixin reported (link in Chinese). One notice issued by the Shanghai office of the China Securities Regulatory Commission (CSRC), said some brokers� research reports have made the public �question the professionalism and ethics of securities firm�s researchers and analysts.�
Some stock analysts have turned into cyber stars in China in recent days, after presenting their research online. One prominent example is Liao Lei, a stock analyst with Founder Securities, who is arguably better known for her costumes than her research.

In one clip posted Apr. 7 on video-sharing app Meipai, Liao, dressed in traditional Han Chinese robe known as Hanfu, �strongly recommends� investors buy shares in Chinese telecom firm ZTE. �Currently, the size of the company�s revenue and cash flow have reached the best level in history, and the gross margin is relatively stable,� she says to the camera, with her hand propping up her cheek.
ZTE�s share price has dropped 8% since her broadcast.
Several other analysts, male and female both, from brokerages including Haitong Securities and Essences Securities are also streaming their research reports online. The videos and streaming are relatively unprofessional, but they are attracting thousands, or tens of thousands, of viewers:

But the reviews of their stock analysis are mixed. Liao�s video on Meipai has been deleted. A re-post on video portal Youku (video in Chinese) has attracted around 1,800 views. �What do you have besides big eyes?,� one viewer commented, adding her logic and stammering have made things difficult to understand. Another called her stock advice �nonsense.�
The regulators� notices doesn�t entirely ban social media publication of brokerages� research reports, Caixin noted, but it does mean that China�s authorities are continuing to crack down on information available on the internet.

http://qz.com/669079/chinese-brokers-are-using-attractive-female-analysts-to-tout-stocks-online/

# ? Apr 25, 2016 14:28

Potato Salad: Oct 23, 2014; nobody cares

Looks like the States have found some common ground with the Chinese.

# ? Apr 25, 2016 21:03

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

Jumpingmanjim posted:

http://qz.com/669079/chinese-brokers-are-using-attractive-female-analysts-to-tout-stocks-online/

Here's an off-the-wall idea: Why not treat stocks like Japanese treat girlbands? The more you buy, the greater your chance to win passes to meet your favorite stock idol.

# ? Apr 26, 2016 06:22

namaste friends: Sep 18, 2004; by Smythe

https://next.ft.com/content/4bb772de-1045-11e6-91da-096d89bd2173

quote:

China financial regulator clamps down on shadow banking
Chinese banks have disguised risky loans as investment products

China�s banking regulator is cracking down on financial engineering that Chinese banks have used to disguise trillions of dollars in risky loans as investment products.

The clampdown, which will force banks to make provisions they previously avoided by disguising loans as investments, is designed to deflate one of the fastest-growing areas of the vast shadow banking apparatus, where bad debts are increasing.

Shadow banking emerged as a force five years ago, ranging from interbank transactions through to wealth management products, which promise inflated returns often backed by loans to struggling companies.

During the past three years, banks in China have used complex accounting techniques to move loans off the balance sheets and into a category of investments that requires less provisions than loans.

It has also reduced the rate of defaults that appear on bank balance sheets because the assets no longer have the characteristics of loans.

These so-called debt receivables have become one of the fastest growing areas of Chinese banks. Debt receivables increased 63 per cent to Rmb14tn ($2.2tn) last year, according to an analysis of 103 Chinese banks by Wigram Capital Advisors, equivalent to 16.5 per cent of the formal loan book.

Analysts say shadow banking poses a big risk to China�s financial system because many of the products are designed to skirt regulation and promote risk-laden investment.

Under the new rules, released at the weekend by the China Banking Regulatory Commission, banks can no longer use wealth management funds to invest directly or indirectly in their own investment products. The lenders will also have to fully provision for the investment products that are based on bank loans.

�If execution is right, I think you will see a major impact on the banks, especially some of the smaller ones,� said Wei Hou, director at Sanford C Bernstein in Hong Kong. �Some of the small banks could need additional capital.�

While smaller banks are most active in shadow banking, the big four state-owned banks also reduced provisions last year on their traditional loan books. By making less provision, the biggest banks were able to maintain largely flat profit growth last year. If they are forced to provision more for once-hidden losses, profit growth could decline faster this year.

Ratios for provisions on losses continued to fall in the first three months of the year, financial statements showed.

The provisioning ratio at China�s biggest bank, Industrial and Commercial Bank of China, fell to 141 per cent of bad debt, below the 150 per cent threshold set out by the regulator, which was recently lowered from 200 per cent. ICBC�s profit growth was nearly flat for the quarter.

Mid-sized Industrial Bank reported some of the highest levels of investment receivables in its first-quarter results. The bank held Rmb2tn in investment receivables as of the end of March, 36 per cent of its total assets and equivalent to the size of Singapore�s gross domestic product last year.

wassup guys :smug:

# ? May 2, 2016 20:36

Toplowtech: Aug 31, 2004

Cultural Imperial posted:

https://next.ft.com/content/4bb772de-1045-11e6-91da-096d89bd2173

wassup guys

"See if i switch those numbers from column A and column B and noone notice or call us on our lies, we are actually billionaires!" :suicide:

# ? May 2, 2016 22:35

OXBALLS DOT COM: Sep 11, 2005; by FactsAreUseless; Young Orc

Toplowtech posted:

"See if i switch those numbers from column A and column B and noone notice or call us on our lies, we are actually billionaires!"

This is how high finance in America works, too. As usual, though, they forget to do their ground work while blindly copying the US. You need to own the government before you can get away with this silly Chinese bankers

# ? May 2, 2016 23:07

McGavin: Sep 18, 2012

Buy eggs now or be priced out forever!

# ? May 3, 2016 21:01

I would blow Dane Cook: Dec 26, 2008

The hot new thing in the Chinese ~~Financial Markets~~ Casino is commodities:

quote:

The World's Most Extreme Speculative Mania Unravels in China

From the Dutch tulip craze of 1637 to America�s dot-com bubble at the turn of the century, history is littered with speculative frenzies that ended badly for investors.

But rarely has a mania escalated so rapidly, and spurred such fevered trading, as the great China commodities boom of 2016. Over the span of just two wild months, daily turnover on the nation�s futures markets has jumped by the equivalent of $183 billion, outpacing the headiest days of last year�s Chinese stock bubble and making volumes on the Nasdaq exchange in 2000 look tame.

What started as a logical bet -- that China�s economic stimulus and industrial reforms would lead to shortages of construction materials -- quickly morphed into a full-blown commodities frenzy with little bearing on reality. As the nation�s army of individual investors piled in, they traded enough cotton in a single day last month to make one pair of jeans for everyone on Earth and shuffled around enough soybeans for 56 billion servings of tofu.

Now, as Chinese authorities introduce trading curbs to prevent surging commodities from fueling inflation and undermining plans to shut down inefficient producers, speculators are retreating as fast as they poured in. It�s the latest in a series of boom-bust market cycles that critics say are becoming more extreme as China�s policy makers flood the financial system with cash to stave off an economic hard landing.

�You have far too much credit, money sloshing about, money looking for higher returns,� said Fraser Howie, the co-author of �Red Capitalism: The Fragile Financial Foundation of China�s Extraordinary Rise.� �Even in commodities where you could have argued there is some reason for prices to rise, that gets quickly swamped by a nascent bull market and becomes an uncontrollable bubble.�
Night Trading

In many ways, China�s financial landscape was ripe for another round of mania. New credit soared to a record in the first quarter, giving individuals and businesses plenty of cash to invest at a time when several of the country�s traditional sources of return looked unattractive.

Government debt yields were hovering near record lows, while wealth-management products and company bonds had been rattled by a growing number of corporate defaults. Stocks were still too risky for many investors burned by last year�s crash, and moving money offshore had become harder as the government clamped down on capital outflows.

Jeremy He started pouring his savings into commodities last month after losing money in China�s stock rout and deciding that returns from his WMPs were too low. The 25-year-old employee at a multinational trade company in Shanghai set up a joint account with his friend to trade futures on rebar, coal and cotton, making as much as 150 percent before prices started falling at the end of last month.

Retail Punters

"I�m pretty bored at work, so I trade commodities futures for some excitement,�� said He, whose account swelled to as much as 700,000 yuan ($107,596) before sliding back to 400,000 yuan at the end of April. �Because I�m making investments with my friend, we can comfort each other when we are making a loss.��

Nobody knows for sure how much of the trading surge has been driven by individuals, but the evidence suggests retail punters are playing a big role. More than 40 percent of the volume in rebar futures last month came during the night session, when it�s more convenient for people with day jobs to trade. The average holding period for contracts including rebar and iron ore was less than 3 hours in April, according to data compiled by Bloomberg.

Individuals with a bank account and official identity card can open a futures trading account at a brokerage within 40 minutes, with no initial balance required, Morgan Stanley said in a report on May 4.

While at least five commodities in China gained more than 50 percent from their recent lows during the trading surge, the rally in prices is still a far cry from the Shanghai Composite Index�s 159 percent advance to its peak last year, or the Nasdaq Composite Index�s 256 percent advance at the height of the dot-com boom 16 years ago.

What makes the frenzy in China stand out is the sheer volume of trading. Market turnover on bourses in Dalian, Zhengzhou and Shanghai jumped from a daily average of about $78 billion in February to a peak of $261 billion on April 22 -- exceeding the gross domestic product of Ireland. Turnover on Nasdaq�s exchange in early 2000, by contrast, peaked at about $150 billion.

China�s frenzy has begun to cool after the three main futures bourses took steps to curb speculation by raising margin requirements, lifting trading fees and, for rebar, cutting trading hours in the evening session. Total turnover on May 6 was $125 billion, down about $135 billion from the peak, while prices for rebar and iron ore have dropped almost 20 percent from their highs in April.
Steel Demand

Some individuals are staying invested despite official attempts to rein in the market. Peter Sun, a 30-year-old professional in the financial industry in Shanghai, opened a futures account last month to trade steel, bitumen and glass after work. He devotes about half his income to investment, using technical patterns to make his buy and sell decisions because he doesn�t have time for more in depth analysis of supply and demand.

�I�m not concerned about measures aimed at cooling down the market,�� Sun said.

For some commodities, there were fundamental reasons for prices to rise. Steel demand has increased amid fresh spending on infrastructure and a pickup in the property sector. New floor space under construction in China rose by 19 percent in the first quarter, boosting usage at a time when supplies of steel from warehouses and mills was running low. Physical prices surged, with rebar still up as much as 48 percent from its December low on the spot market, according to Beijing Antaike Information Development Co., a state-owned consultancy.
Market Froth

Yet China�s response to the boom suggest authorities are worried there�s froth in the market. Officials at the China Securities Regulatory Commission have pledged to prevent excessive speculation, while the Dalian Commodity Exchange said in a statement that �some sectors of the society still have limited understanding of the futures market.�� Regulators including the CSRC have prepared further measures to limit price fluctuations if abnormal volatility persists, people with knowledge of the matter said last month.

�They don�t want this to turn into a speculative market in commodities,�� said Tiger Shi, managing partner at Bands Financial Ltd. in Hong Kong, who�s been trading commodities for two decades.

If China�s equity bubble is any guide, regulators may find it difficult to cool excessive speculation without triggering a collapse in prices. Domestic shares lost $5 trillion of value last summer as authorities moved to curb leveraged bets and restrain trading in the stock-index futures market, where volumes tumbled by 99 percent from their peak.

�The worry is that as soon as the bubble bursts, it�s everyone out of the door at the same time,�� said Paul Adkins, managing director of AZ China Ltd., a Beijing-based aluminum consultancy. �It�s the last guys out the door that have the most pain.�

http://www.bloomberg.com/news/articles/2016-05-09/world-s-most-extreme-speculative-mania-is-unraveling-in-china

Typical market participant:

# ? May 10, 2016 03:47

Ccs: Feb 25, 2011

Bloomberg has a new article panicking about Chinese college graduates taking American jobs. I can't assess how accurate this is, anyone with more knowledge of white collar global economy and China's education system want to try?

http://www.bloomberg.com/view/articles/2016-05-23/trump-is-worried-about-the-wrong-china-threat

quote:

In the last decade, China has produced close to 60 million college graduates. By 2030, the World Bank expects there to be up to 200 million -- more than the entire U.S. workforce. They�ll join those from India and Latin America in an increasingly crowded global market for brainpower.

Practical as well as trade barriers mean there are some areas where Chinese white-collar workers won�t make major inroads globally. But in many others -- from crunching the numbers behind a trading strategy, to writing code, to reviewing X-rays -- some of the work is already being outsourced and more will be. After all, iPads assembled in China have to be shipped to the U.S., with all the associated logistical costs. New iPad apps designed in China can simply be uploaded.

The consequences for U.S. professional classes could be far-reaching. In finance, medicine, and information technology, Chinese wages remain substantially below the level in the U.S. Since 2001, wages for the 40th to 80th percentile of Americans -- the heart of the middle class -- have stagnated. In the next decade, those workers could join low earners in seeing their salaries shrink.

China�s graduates, who will enjoy more opportunities and higher salaries as part of the global labor force, won�t be the only winners, of course. More brain power means more opportunities to innovate, pushing back the global technology frontier. U.S. firms will benefit from lower wage costs and consumers will pay less for services. But the lesson of the last 15 years is that even if more trade is a net plus for the world economy, the distribution of gains is far from even.

quote:

Losers need to be compensated, not stigmatized. That�s about fairness. It�s also the price of ensuring continued support for a process that in aggregate makes the world better off. Redistribution also serves another essential purpose -- leaning against the blow to demand that comes as globalization channels an ever-larger share of income to high-saving elites.

# ? May 24, 2016 22:10

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
---------------------------->

The article assumes that all college graduates are created equal when Chinese institutions are essentially glorified degree factories, and even Western institutions have pressure applied to them to pass wealthy Chinese even if they aren't particularly qualified.

It's another one of those cases where China looks really strong on paper but the paper doesn't match the reality. Western-educated graduates are going to continue to be considered top tier for the foreseeable future.

# ? May 24, 2016 22:21

Arglebargle III: Feb 21, 2006

Can we page grand autismo to the thread to tell his story about buying diplomas?

# ? May 24, 2016 22:23

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
---------------------------->

Also lol at the notion of Chinese apps being popular outside of China and a handful of other middle-income countries. I'm not even convinced they would be particularly popular in China itself if the Chinese market wasn't so inaccessible to outsiders.

White people have been writing articles like that with grand predictions about China's future for like a decade now that completely ignore the reality on the ground in favor of "What if China was another America, but with a billion people?!?" and there have been a surge of "Watch out, China is innovating now!" articles over the past few months because "thing is now more popular in China than western brands (because the Chinese market is becoming more and more opaque and Western brands are being forced out by the government while domestic brands are subsidized)

A great example of this was when the totally impartial and independent Chinese courts made the "Iphone" trademark in China freely available for use by loving everyone.

Fojar38 fucked around with this message at 22:45 on May 24, 2016

# ? May 24, 2016 22:40

McGavin: Sep 18, 2012

Fojar38 posted:

Also lol at the notion of Chinese apps being popular outside of China and a handful of other middle-income countries. I'm not even convinced they would be particularly popular in China itself if the Chinese market wasn't so inaccessible to outsiders.

Half the realtors in Vancouver now list their WeChat ID on their ads.

# ? May 24, 2016 22:45

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
---------------------------->

McGavin posted:

Half the realtors in Vancouver now list their WeChat ID on their ads.

Is that because they want to use them or because like 90% of their customers are from mainland China?

# ? May 24, 2016 22:46

McGavin: Sep 18, 2012

The latter.

# ? May 24, 2016 22:46

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
---------------------------->

Okay. I don't think that is a particularly good example of a Chinese brand going global. China isn't even where Japan was in the 70's and 80's as far as branding is concerned yet and to be frank, they probably never will be.

I can only name a handful of Chinese brands off the top of my head and I pay a ton of attention to China. My guess for your average joe anywhere but China would be 0.

# ? May 24, 2016 22:49

Oracle: Oct 9, 2004

McGavin posted:

Half the realtors in Vancouver now list their WeChat ID on their ads.

Gotta launder that sweet sweet tea money somehow.

# ? May 24, 2016 23:00

the talent deficit: Dec 20, 2003; self-deprecation is a very british trait, and problems can arise when the british attempt to do so with a foreign culture

China is miserable at comp sci education. Almost all the good Chinese developers are educated in the west. If you are a third rate programmer but you're white and tall you can write your own ticket to manage a bunch of terrible chinese educated developers in Chengdu

# ? May 25, 2016 04:33

feedmegin: Jul 30, 2008

Fojar38 posted:

Okay. I don't think that is a particularly good example of a Chinese brand going global. China isn't even where Japan was in the 70's and 80's as far as branding is concerned yet and to be frank, they probably never will be.

I can only name a handful of Chinese brands off the top of my head and I pay a ton of attention to China. My guess for your average joe anywhere but China would be 0.

I can think of some exceptions, Xiaomi, Lenovo and Huawei for example.

# ? May 25, 2016 11:48

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

feedmegin posted:

I can think of some exceptions, Xiaomi, Lenovo and Huawei for example.

Volvo, Hummer, and Smithfield!

# ? May 25, 2016 14:53

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
---------------------------->

feedmegin posted:

I can think of some exceptions, Xiaomi, Lenovo and Huawei for example.

Yeah, but those brands are no Sony's or Toshiba's. Their success is chiefly in China and other middle-income economies and even China's titans like Alibaba have had difficulty breaking into high-income markets.

# ? May 25, 2016 16:25

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# ? May 26, 2024 21:03

feedmegin: Jul 30, 2008

Fojar38 posted:

Yeah, but those brands are no Sony's or Toshiba's. Their success is chiefly in China and other middle-income economies and even China's titans like Alibaba have had difficulty breaking into high-income markets.

Not really? Lenovo in particular is a widely known brand of laptop in the West, and the other two make cheapo smartphones which are edging up in market share worldwide. They're not Apple-premium or anything but they're definitely a thing in the developed world.

# ? May 25, 2016 16:27

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