Is China's economy destined to crash?

[Kevin Brown]

Recently in Newsweek's predictions for 2010 and the immediate years beyond that, one of the predictions was that China's economy would crash.

This bold prediction has been echoed in other circles out there as well. In addition, as many of us well know on here there is the strong potential for he Chinese economic machine to become unhinged. As numerous bubbles within many sectors of the Chinese economy in areas like real estate, stocks, and banking are developing, combined with rampant corruption, economic mismanagement, and the growth and proliferation of informal sectors of the Chinese economy like counterfeit and pirated goods. The Chinese economy is quite vulnerable to an economic crash.

Any other opinions on here about the state of the Chinese economy and it's future?

[xinhui]

You can short the Chinese stock market and make some money out of this.

Recently in Newsweek's predictions for 2010 and the immediate years beyond that, one of the predictions was that China's economy would crash.

Link plz

[middle earth]

It has all the symptoms News week’s prediction claims, but I assure you it won’t crash. In Chinese term, the word is adjustment, even that may not occur. It will make people’s life harder, people will raise their voice of discontent, the government’s reaction will be slow and reluctant in addressing these problems and the government and CCP may lose even more credit, but the last thing is a crash. We can only expect change after Hu and Wen’ term expires in 2011, but not sure.

It’s not a totally bad thing to have a crash, it is absolutely not a good thing for these problems to accumulate. Deng Xiaoping told us: “Trace the stone to cross river”, it’s a good excuse.

[Kevin Brown]

You can short the Chinese stock market and make some money out of this.



Link plz

Certainly,

Castro Dies, U.S. Relations Improve - World Predictions - Newsweek 2010

It is number 2 in the list,

[TopHatter]

As numerous bubbles within many sectors of the Chinese economy in areas like real estate, stocks, and banking are developing, combined with rampant corruption, economic mismanagement, and the growth and proliferation of informal sectors of the Chinese economy like counterfeit and pirated goods. The Chinese economy is quite vulnerable to an economic crash.

I'm most certainly biased in this one regard, but I see this as severely stifling China's rise to a truly respected economic superpower.

If China and the Chinese literally laugh themselves silly at the idea of intellectual property laws, then how and why is the rest of the world to take China's aspirations seriously?

Deng Xiaoping told us: “Trace the stone to cross river”

I feel rather stupid for asking this, but I'm having a little trouble understanding that quote, can you explain it a little better?

If it means what I think it means, then it's a very wise quote indeed.

[middle earth]

I feel rather stupid for asking this, but I'm having a little trouble understanding that quote, can you explain it a little better?

If it means what I think it means, then it's a very wise quote indeed.

If you fall into the water, it’s not your fault because it’s uncharted water. It is an extension of Deng’s quote in meaning.

[JAD_333]

Predictions of China's economic collapse aren't new. Thay go back to the 1990s. In 2006 some economists said 2009 would be the fateful year. China's economy is out of control - MSN Money

The arguments going forward remain largely unchanged. But there is a difference this time: the overall stagnation in the world economy is causing cutting into China's exports. Factory layoffs are growing. But at the same time, China has the means to react nimbly to economic problems. China's $500 plus billion stimulus package needed no "Congressional" scrutiny and is credited with quickly stabalizing its economy; the government is encourgaing banks to extend more credit to business. Of course, they will stand up and salute. GM's Chinese plant is booming. Foreign interests keep coming. Even Krispy Creme donuts is opening a Chinese plant.

Having little political resistence to stimulative moves may seem an advantage on the surface, but being quick off the mark doesn't guarantee success. A capitalist economy cannot be treated as a command economy. Should the economic engine sputter, ordering it to restart won't be enough.

[RollingWave]

If you mean if it's going to hit a stumbling block at some point in time? then .. ummm. YES! , but there would be a huge difference if that year is next or if it's 30 year from now.

[xinhui]

I'm most certainly biased in this one regard, but I see this as severely stifling China's rise to a truly respected economic superpower.

If China and the Chinese literally laugh themselves silly at the idea of intellectual property laws, then how and why is the rest of the world to take China's aspirations seriously?

I feel rather stupid for asking this, but I'm having a little trouble understanding that quote, can you explain it a little better?

If it means what I think it means, then it's a very wise quote indeed.

Yup, the natives are restless.

The capture reads "damn Chinese knockoffs go to hell"

[Zinja]

I think China just has to allow its currency to steadily appreciate to ease off some of nagging problems.

[kualaws]

Recently in Newsweek's predictions for 2010 and the immediate years beyond that, one of the predictions was that China's economy would crash.

This bold prediction has been echoed in other circles out there as well. In addition, as many of us well know on here there is the strong potential for he Chinese economic machine to become unhinged. As numerous bubbles within many sectors of the Chinese economy in areas like real estate, stocks, and banking are developing, combined with rampant corruption, economic mismanagement, and the growth and proliferation of informal sectors of the Chinese economy like counterfeit and pirated goods. The Chinese economy is quite vulnerable to an economic crash.

Any other opinions on here about the state of the Chinese economy and it's future?

well, the key bubble focuses on real estate. prices on both land and apartments are ridiculously high. banks are involved because they loan money to developers. and the general opinions believe local governments promote the price of land and then affect real estate price further. center government has realized it, but it has few option on it, for it is its subordinates who mess up the situation. if real estate market can be kept stable, with whatever cost, the whole chinese economy may still be fine.

[Kevin Brown]

well, the key bubble focuses on real estate. prices on both land and apartments are ridiculously high. banks are involved because they loan money to developers. and the general opinions believe local governments promote the price of land and then affect real estate price further. center government has realized it, but it has few option on it, for it is its subordinates who mess up the situation. if real estate market can be kept stable, with whatever cost, the whole chinese economy may still be fine.

kualaws,

Do you think it's very likely that real estate can be kept stable or do you think the bubble in the real estate sector will finally burst?

[kualaws]

kualaws,

Do you think it's very likely that real estate can be kept stable or do you think the bubble in the real estate sector will finally burst?

good question. unlike america, china has its special regime, the regime more like DPRK, when i say the method "with any cost", it is the method beyond the option of american government. in the usa, real estate bubble has to burst for relative businesses or economical departments have to take responsibility of their own, but in china, it may come out ordinary people, who are in large amount, have to pay for it finally. then real estate market may keep stable. i do wish it is not an option, but it is beyond my control.

[Luke Gu]

but in china, it may come out ordinary people, who are in large amount, have to pay for it finally.

Can you tell me how？

[tphuang]

there is no question there are some serious problems in the Chinese economy where the real estate speculation is out of control and there is too much excessive lending. However, the fundamentals of the Chinese economy is still on the right side. It has a very competitive manufacturing industry and its consumption is going up a lot every year. Even if the real estate boom ends, they still have a host of gov't backed construction projects to take in orders. Newsweek should spend more time looking at how the US, UK and Japanese economy are going to crash next year.