Posted on 11/26/2008 9:17:57 AM PST by traumer
The move came just one day after the World Bank predicted that China would grow by 7.5pc next year. The level of growth may appear robust by Western standards, but it would represent the slowest economic expansion in China for the last two decades.
It is also perilously close to the 7pc minimum level of growth that Chinese economists believe is necessary in order to create enough jobs for the 6m university graduates who will enter the jobs market next year.
It is the fourth interest rate cut from the Chinese central bank in the last ten weeks as the government desperately battles an evident economic collapse. "China is out to save itself here," said Patrick Bennett, an analyst with Societe Generale in Hong Kong.
The PBOC reduced its main borrowing rate by 1.08pc points to 5.58pc, the biggest one-off cut since the Asian Financial Crisis in 1997.
In recent weeks, a series of riots across central and southern China have flowered as disgruntled employees aired their grievances at the downturn.
Today, around 500 protesters rioted at the Kai Da toy factory in Dongguan in the Pearl River delta, flipping over a police car and trashing computers in a dispute over payoffs to 80 fired workers. Tens of thousands of factories across the region have already shut their gates.
Yin Weimin, China's Social Security minister, has revealed that employment is the Communist Party's number one concern in the downturn and said the "situation is critical". Unemployment is expected to rise from 4pc to 4.5pc by the end of the year and anecdotal reports have suggested that 3m people have already been fired in the industrial province of Zhejiang alone.
(Excerpt) Read more at telegraph.co.uk ...
Many were saying months ago (before the games) that as this world economy thingee went south, things could get VERY ugly in China.
From the article: “Two major provinces, Shandong and Hubei, have already responded by banning companies from firing staff without permission from the government.”
Gee, what if you can’t make payroll? Socialists are idiots. Seriously.
If the company cannot meet the payroll it’ll obtain a ‘chinese bailout’....
:o)
Political protest is illegal in China. But economic protests are common, often over corruption or abuse of workers by a business.
Someone’s gonna have to fill me in....why’s China in bad shape? Because they hold our debt?
China makes all our stuff. When we stop buying stuff, they stop selling stuff. Factories close just as people started pulling themselves out of the mud. And they created a huge production infrastructure for producing stuff for us. Now they are kinda stuck.
And it is gonna get a LOT worse in the next year or three.
Makes sense. Thanks for the explanation!
My explanation sounded kinda condescending. Sorry. that was not my intent. I was being just a bit silly on purpose. :)
China is living from paycheck to paycheck and needs cash flow, and it is not just the USA that is failing to buy consumer merchandise.
Part of the reason is that they make all the stuff that the rest of the world isn’t buying at the moment. Massive inventory oversupply.
After reading that sentence, Obama began to giggle...
But since they sit on a big pile of ca$h - they can bail the companies out...
No sweat...I didn’t take it that way at all!
Hm. Take "they" and "stuff" out of that sentence and replace it with "we" and "dollars" and we may be looking at our fate as well.
>>But since they sit on a big pile of ca$h - they can bail the companies out...<<
We’ll see how that works for them.
As Sarah Palin would say, “You betcha.”
GOTCHA !
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.