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Beijing's Empty Bullet Trains
Slate ^ | April 14, 2011 | Nouriel Roubini

Posted on 04/16/2011 1:22:46 PM PDT by fightinJAG

I recently took two trips to China just as the government launched its 12th Five-Year Plan to rebalance the country's long-term growth model. My visits deepened my view that there is a potentially destabilizing contradiction between China's short- and medium-term economic performance.

China's economy is overheating now, but, over time, its current overinvestment will prove deflationary both domestically and globally. Once increasing fixed investment becomes impossible—most likely after 2013—China is poised for a sharp slowdown. Instead of focusing on securing a soft landing today, Chinese policymakers should be worrying about the brick wall that economic growth may hit in the second half of the quinquennium.

(Excerpt) Read more at slate.com ...


TOPICS: News/Current Events
KEYWORDS: china; conflict; economy; globalism

1 posted on 04/16/2011 1:22:49 PM PDT by fightinJAG
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To: fightinJAG

1.3 Billion - hard to support that many people a terrible prospect.


2 posted on 04/16/2011 1:29:37 PM PDT by Flavius (Keep your teeth to the wind)
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To: fightinJAG

Bullet Train Shoots Blanks.
Film at 11:00.


3 posted on 04/16/2011 1:34:05 PM PDT by BuddhaBrown (Path to enlightenment: Four right turns, then go straight until you see the Light!)
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To: fightinJAG
China hitting this brick wall in 2013 may be the event that causes the dollar collapse we all know is coming
4 posted on 04/16/2011 1:34:34 PM PDT by JZoback (Obama speech I want to hear: I resign the office of the Presidency immediately............)
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To: fightinJAG

For about four years now, we’ve been seeing the story that China’s economy is on the verge of a crash to support arguments in favor of continuing the global “free trade” regime (trade policies favoring manufacturing in China and against manufacturing in the USA). ...propaganda.

Enjoy your globalism/debt game. It’s going to get a lot worse for most Americans—increasingly angry Americans.


5 posted on 04/16/2011 2:00:53 PM PDT by familyop ("Don't worry, they'll row for a month before they figure out I'm fakin' it." --Deacon, "Waterworld")
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To: familyop

What’s your take on Roubini’s idea that China is going to go into deflation before too long because its economy is propped up with unsustainable spending on infrastructure?


6 posted on 04/16/2011 2:59:57 PM PDT by fightinJAG (I am sick of people adding their comments to titles in the title box. Thank you.)
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To: JZoback

If China does goes into a deflationary spiral, wouldn’t that counter the inflationary spiral that seems to be coming in the West (specifically, the U.S.)?


7 posted on 04/16/2011 3:01:31 PM PDT by fightinJAG (I am sick of people adding their comments to titles in the title box. Thank you.)
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To: BuddhaBrown

Exactly. And the Dangerous Bumbler in the White House is still touting the bullet train to national bankruptcy every time he opens his mouth.


8 posted on 04/16/2011 3:02:20 PM PDT by fightinJAG (I am sick of people adding their comments to titles in the title box. Thank you.)
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To: fightinJAG
China's prosperity is dependent on the export market. Right now high oil prices are taking revenue that China was counting on and giving it to the Arabs, as well as increasing China's internal expenses.

Do not be surprised if China does something about it.

9 posted on 04/16/2011 3:03:47 PM PDT by PapaBear3625 ("It is only when we've lost everything, that we are free to do anything" -- Fight Club)
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To: fightinJAG

Is this the bullet train to bankruptcy that Gov. Palin was talking about?


10 posted on 04/16/2011 3:04:37 PM PDT by rabidralph (http://www.conservativedna.com/)
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To: fightinJAG
What’s your take on Roubini’s idea that China is going to go into deflation before too long because its economy is propped up with unsustainable spending on infrastructure?

Funny you should ask that as I read this article last night describing how this was happening:

The ghost towns of China

Apparently the provinces are doing this because they have to meet GDP quotas and construction is the easiest way to do it.
11 posted on 04/16/2011 3:09:07 PM PDT by microgood
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To: fightinJAG

Yes, John Bolton thinks the chinese economy is a big fat lie.


12 posted on 04/16/2011 3:13:53 PM PDT by shield (Rev2:9 Blasphemy of them which say they're Israelites, and are not, but are the synaGOGue of Satan.)
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To: microgood
Amazing what can happen when you try to manipulate markets... especially on the larger scale.

(China is far more capitalist in practice than the US, by the way.)

13 posted on 04/16/2011 3:18:37 PM PDT by Teacher317 (really?)
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To: fightinJAG
"What’s your take on Roubini’s idea that China is going to go into deflation before too long because its economy is propped up with unsustainable spending on infrastructure?"

Opinions from business writers have said that China's activity would overheat and decline for about four years, while China's manufacturing and GDP increased radically. China has other trading partners buying products and selling commodities (natural resources for manufacturing products).

As for infrastructure, the Chinese communists (Hans) build cities, then move populations into them. Forced mass movements have been the way there for thousands of years. They've already done so in several cities. Communism, monarchy, autocracy--same thing where it counts for most of us. It's easier to build without many people in the way.

Oh, China will eventually have economic troubles, probably after our default has run its course. Her demise will be communism, but in the meantime, ours will be the lack of a large, heavy, domestic manufacturing base and regulations against new, small manufacturing business starts (ingenuity, morality, families...see US civics, moral laws and religious demographics of members of Congress from 1776-1968 as compared to most recent two decades).


14 posted on 04/16/2011 3:19:05 PM PDT by familyop ("Nice girl, but about as sharp as a sack of wet mice." --Foghorn Leghorn)
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To: fightinJAG

...better tagline for the context of this thread and who I was replying to.


15 posted on 04/16/2011 3:20:09 PM PDT by familyop (cbt. engr. (cbt), NG, '89-' 96, Duncan Hunter or no-vote.)
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To: PapaBear3625

IIRC, China has a lot of pre-paid contracts for Iranian oil.


16 posted on 04/16/2011 3:35:17 PM PDT by fightinJAG (I am sick of people adding their comments to titles in the title box. Thank you.)
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To: microgood

I previously read that article, too — thanks for bringing it to mind (and providing the link).

I can see how China is playing with a bubble. But still pondering how, exactly, that might affect the U.S./global economy.

I wonder since China owns a lot of our debt, if China has a way, essentially, to call in its loans if it gets in trouble. Certainly if China pops, it won’t have the continued means to finance our spending in the future.


17 posted on 04/16/2011 3:37:52 PM PDT by fightinJAG (I am sick of people adding their comments to titles in the title box. Thank you.)
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To: Teacher317

China has not only manipulated its market, it’s manipulated its demographics.

Its “one child” policy is going to cause BIG problems in the future (shortly).


18 posted on 04/16/2011 3:39:04 PM PDT by fightinJAG (I am sick of people adding their comments to titles in the title box. Thank you.)
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To: familyop
Oh, China will eventually have economic troubles, probably after our default has run its course. Her demise will be communism, but in the meantime, ours will be the lack of a large, heavy, domestic manufacturing base and regulations against new, small manufacturing business starts (ingenuity, morality, families...see US civics, moral laws and religious demographics of members of Congress from 1776-1968 as compared to most recent two decades).

I think this is a good call.

19 posted on 04/16/2011 3:41:34 PM PDT by fightinJAG (I am sick of people adding their comments to titles in the title box. Thank you.)
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To: familyop

Roger that. Charlie Mike!


20 posted on 04/16/2011 3:42:31 PM PDT by fightinJAG (I am sick of people adding their comments to titles in the title box. Thank you.)
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To: microgood

About the ghost towns: China is awash in cash from sales to the USA. They are spending it hands over fists with their central planning bureaucracy building nice things for which there is yet to be a demand. Those empty cities and bullet trains are examples.


21 posted on 04/16/2011 3:49:19 PM PDT by Mind-numbed Robot (I retain the right to be inconsistent, contradictory and even flat-out wrong!)
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To: fightinJAG

Empty bullet trains speeding between unpopulated cities. What if they threw an economic miracle and nobody came?


22 posted on 04/16/2011 9:35:01 PM PDT by Mike Darancette (The heresy of heresies was common sense - Orwell)
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