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Chinese Economy Slowing Down(and demand deposit increasing fast)
Yonhap News ^ | 07/12/05 | Kwon Young-suk

Posted on 07/12/2005 6:03:04 PM PDT by TigerLikesRooster

/begin my translation

Chinese Economy Slowing Down

(Hong Kong, Yonhap News) correspondent Kwon Young-suk -- Due to contracting investment, Chinese economy is slowing down, according to the analysis of Morgan Stanley on July 12.

Andy Xie, a Morgan Stanley's analyst, said in his report that Chinese corporate profit and real estate price has changed their trend and now on their way down, while corporate investment is decreasing.

He emphasized, "In particular, the austerity measures introduced in August 2003, had been loosened since last October, which allowed overcapacity of Chinese economy to persist."

Report also notes that China's demand deposit has skyrocketed from 4.4 trillion yuan($531.6 billion) in 2001 to current level of 7.5 trillion yuan($906 billion), urging Chinese government to take proper countermeasures.

He pointed out that the recent increase of demand deposit is due to hot money, anticipating yuan's revaluation, or money generated from corrupt activities. The large outflow of such money could cause a financial crisis.

He added, "To prevent it, they need stepped-up measures against inflating the nominal value of import or reducing the nominal value of export, along with anti-corruption campaign."
2005/07/12

/end my translation


TOPICS: Business/Economy; Foreign Affairs; News/Current Events
KEYWORDS: austeritymeasure; china; corruption; economy; financialcrisis; overcapacity; slowdown; yuanrevaluation
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1 posted on 07/12/2005 6:03:09 PM PDT by TigerLikesRooster
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To: TigerLikesRooster; AmericanInTokyo; OahuBreeze; yonif; risk; Steel Wolf; nuconvert; MizSterious; ...

Ping!


2 posted on 07/12/2005 6:03:32 PM PDT by TigerLikesRooster
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To: TigerLikesRooster

How does this square with the report today that Chinese exports grew 32% in the first 6 months.... Isnt that a tremendous growth engine?

http://news.xinhuanet.com/english/2005-07/13/content_3212357.htm


3 posted on 07/12/2005 6:07:54 PM PDT by grondram (The problem with the middle of the road is that you're passed on all sides and likely to be runover.)
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To: grondram

"""How does this square with the report today that Chinese exports grew 32% in the first 6 months.... Isnt that a tremendous growth engine?"


actually it does square.

1. domestic demand is slowing, so excess is exported
2. export growth is faster than import growth indication of a slowing economy.
3. Chinese oil import growth is something like in the high single digits this year versus 40% last year.


all the $100 barrel oil bulls are gonna lose big if this story is true.


4 posted on 07/12/2005 6:10:34 PM PDT by atlanta67
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To: grondram
Re #3

This article talks about corporate profit, while the article is about export volume. Export volume may increase, while profit goes down. It means that profit margin is dwindling fast. They may even export products below production cost.

5 posted on 07/12/2005 6:13:41 PM PDT by TigerLikesRooster
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To: TigerLikesRooster

That's starting to be a respectable amount of cash sitting around.


6 posted on 07/12/2005 6:20:05 PM PDT by snowsislander
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To: TigerLikesRooster; atlanta67

Thank you both.


7 posted on 07/12/2005 6:22:16 PM PDT by grondram (The problem with the middle of the road is that you're passed on all sides and likely to be runover.)
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To: TigerLikesRooster

I think China's going to have a Red revival. It's built into their system, to have a people's revolution whenever necessary and re-establish the Maoist state.


8 posted on 07/12/2005 6:26:06 PM PDT by SteveMcKing
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To: TigerLikesRooster

Time to let their juan float.


9 posted on 07/12/2005 6:33:35 PM PDT by Brilliant
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To: SteveMcKing
Re #8

Actually it is a emerging fascist state.

10 posted on 07/12/2005 6:34:34 PM PDT by TigerLikesRooster
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To: atlanta67

I hope it is true so that all the speculators who spam this forum with disinfo such as "150 per barrel by next summer" (which initially riles all the "Peak Oil" tin foilers and then spreads to normal people...) - de facto market manipulation - get their asses burned.


11 posted on 07/12/2005 6:36:32 PM PDT by GOP_1900AD (Stomping on "PC," destroying the Left, and smoking out faux "conservatives" - Take Back The GOP!)
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To: SteveMcKing; Jeff Head

Indeed, a cooling of the "China Tiger" would allow the CCP to switch gears from "Deng Xiao Ping Thought" to "Chingis Khan Thought!"


12 posted on 07/12/2005 6:37:57 PM PDT by GOP_1900AD (Stomping on "PC," destroying the Left, and smoking out faux "conservatives" - Take Back The GOP!)
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To: Brilliant

And what happens when China's "army of juan" begins to float?


13 posted on 07/12/2005 6:42:51 PM PDT by Jagman
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To: TigerLikesRooster
Correct, which I assume - by their own dogma - would be the cause of my prediction. No?

Is the new wealthy class sufficiently powerful to keep order, or more importantly, stealthy enough not to be noticed by the rest of society? Newly rich people like to be seen, afterall.

And have they acquired enough bones to throw at the angry dogs while they consolidate power? That is - is there a willing middle class of patriotic mercenaries (a loyal police force) whom they can buy-off with jobs and status? Such a class is key to keeping order within the emerging fascist state.

14 posted on 07/12/2005 6:43:20 PM PDT by SteveMcKing
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To: TigerLikesRooster; maui_hawaii; tallhappy; Dr. Marten; Jeff Head; Khurkris; hedgetrimmer; ...

Ping!


15 posted on 07/12/2005 6:51:44 PM PDT by TigerLikesRooster
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To: grondram
How does this square with the report today that Chinese exports grew 32% in the first 6 months

I think it depends on whether or not you have a real currency or an manipulated simulation of a currency falsely pegged to other REAL currencies.

That don't play. Not in the long run.

I've been saying for two years that those that fear China as a threat to our real economy are overplaying the situation. It's like in the early 90s when we were doomed because the Japanese were going to own everything. By the time that got any notice it was already two or three years after it wasn't a possibility anymore.

I'm such a sage. Now I only have to figure out why I can't translate my (infallible) wisdom into actual prosperity. ;^>

16 posted on 07/12/2005 7:08:32 PM PDT by Phsstpok (There are lies, damned lies, statistics and presentation graphics, in descending order of truth)
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To: atlanta67

peak oil, depletion rates, infrastructure issues,refinery issues, quality of crude are a few of the other issues that will keep oil suprisingly high.


17 posted on 07/12/2005 7:15:11 PM PDT by deathb4dishoner
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To: deathb4dishoner

Go away now or I'll report you to the SEC and the FTC. Spammer ...


18 posted on 07/12/2005 7:31:18 PM PDT by GOP_1900AD (Stomping on "PC," destroying the Left, and smoking out faux "conservatives" - Take Back The GOP!)
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To: Phsstpok

Maybe its those big double joints and that walnut beak. : )


19 posted on 07/12/2005 7:48:15 PM PDT by winodog (We need to pull the fedgov.con's feeding tube)
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To: GOP_1900AD

huh?


20 posted on 07/12/2005 9:01:26 PM PDT by deathb4dishoner
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