PRC Economy and Industry: News and Discussions

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Yogi_G
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Re: PRC Economy and Industry: News and Discussions

Post by Yogi_G »

Similarly, the K computer was based on Sparc chips, originally designed at Sun Microsystems in Silicon Valley.
Well, if we are actually handing out credit here, the Sparc chips have a substantial Soviet/Russian contribution to them as well. Boris Babaev a Soviet computer scientist joined Sun after the Soviet collapse and worked on those processors. The processors designed by him powered the SAM batteries protecting Moscow at the height of the cold war.

Not sure how credible the article on indigenous Chinese processors are, but when they mention 3 generation behind are they talking of >100 nm capability? Taiwan and S.Ko have achieved 45 nm and even 30 nm if I am not wrong.

One thing to be noted, is that the Chinese, if the report is right, are on the right track, they are evolving their fabrication process step by step. The soviets in their heyday were not able to proceed beyond a particular nanometer fabrication size and that explained the sizing of their hardware during the heights of the cold war. The Chinese however have the advantage of stealing their way better in the race, which the Soviets, given all the stricter embargoes on them were not able to achieve beyond a particular point. The South Korean system on chip (Sirf V atlas AT 550) in my generic Chinese device is manufactured in China if I am not wrong and uses a 45nm process. So the access is there.
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Re: PRC Economy and Industry: News and Discussions

Post by member_20021 »

Raja Bose wrote:^^^So which design did they steal now? - Intel's, IBM's or Sun's? :lol:
Gus wrote:zlin is a bot that periodically posts some warm and fuzzy achievement by china. don't expect replies.
To be fair, that question is quite rhetoric. Did Bose expect a reply? He already had his conclusion, didn't he?
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Re: PRC Economy and Industry: News and Discussions

Post by wong »

Raja Bose wrote:^^^So which design did they steal now? - Intel's, IBM's or Sun's? :lol:
The word in China was they copied the 366 MHz digital picture frame CPU found in the Aakash Android Tablet.
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Re: PRC Economy and Industry: News and Discussions

Post by Raja Bose »

wong wrote: The word in China was they copied the 366 MHz digital picture frame CPU found in the Aakash Android Tablet.
Maybe that's why they can claim sooper-dooper low power consumption :lol:

Sorry but given the extreme amounts of bare-faced stealing that I have personally seen chipanda have indulge in here both in industry and in academia, I am extremely skeptical of such tall claims like the 400% pindigenous sooper fast sooper computer with sooper low power consumption, as posted above.
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Re: PRC Economy and Industry: News and Discussions

Post by Suraj »

Why the obscure ShenWei chips instead of the more well known and TFTA trumpeted Godson-1/-2/-3/-T processors ? The Godson-T people were at Hot Chips this year, but no recent talk or demo of the SW ones at symposiums like HC recently. Interesting that after so many iterations of Godson they still put an obscure chip in their super, and talk up how homegrown it is. Probably like how the Siemens Velaro trainsets are repainted as the 400% indigenous CRH3.
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Post by member_20021 »

Suraj wrote:Why the obscure ShenWei chips instead of the more well known and TFTA trumpeted Godson-1/-2/-3/-T processors ? The Godson-T people were at Hot Chips this year, but no recent talk or demo of the SW ones at symposiums like HC recently. Interesting that after so many iterations of Godson they still put an obscure chip in their super, and talk up how homegrown it is. Probably like how the Siemens Velaro trainsets are repainted as the 400% indigenous CRH3.
ShenWei is mostly for military purposes, which had the first gen in 2006
http://en.wikipedia.org/wiki/ShenWei,

Loongson is general purpose targeting civilian markets.
http://en.wikipedia.org/wiki/Loongson
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Post by Suraj »

Who comes up with these monikers ? Godson and Loonyson ? At least the names themselves are imaginative and creative :)
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Post by member_20021 »

Suraj wrote:Who comes up with these monikers ? Godson and Loonyson ? At least the names themselves are imaginative and creative :)
The Chinese folklore has it that by giving a humble name you can protect your precious child from devils. In the old days, "Gou-shen" is one of the most common, which literally means "leftover by a dog". I believe Gou-shen was morphed into Go-dson by the marketing people. Loongson, similarly, is from "Long-xin", which literally means the heart (Xin, pronounced as "hsin") of a dragon (Long, pronounced as "Loon").
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Post by Prem »

China PMI falls unexpectedly in October
http://www.ft.com/intl/cms/s/0/27f034c8 ... z1cQVQ2aM5
China’s manufacturing sector growth eased last month as the economy continued to slow in the face of government measures to cool searing growth and rein in stubbornly high inflationThe official purchasing managers' index (PMI) dropped to 50.4 from 51.2 in September. A figure above 50 indicates expansion in manufacturing activity, while a figure below 50 means a contraction. The official index has not fallen below 50 since February 2009, at the height of the global financial crisis.The October reading was lower than many economists had predicted but still indicated growth and suggests the economy is continuing the gradual slowdown that Beijing has been trying to engineer. The dip in the official index, which is based on a survey of purchasing managers in 20 different industries, came after two consecutive months of increase. But analysts said that PMI usually declines by an average of 0.9 percentage points from September to October.China’s economy has gradually slowed this year in response to Beijing’s attempts to tighten credit, cool overheated growth and tackle inflation.Since the start of the year the government has increased interest rates and reserve ratios for banks multiple times as well as employed administrative measures, such as restrictions on housing purchases and directives to banks on which industries to lend to.But in a sign that inflation is under control, the input prices sub-index of the PMI dropped 10.4 percentage points in October from a month earlier, to 46.2, suggesting that some prices for manufacturing inputs are now falling.
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Post by vina »

Photos of the new Sunway supercomputer reveal an elaborate water-cooling system that may be a significant advance in the design of the very fastest machines.
Advance!! :shock: :shock: . Why , they have just reinvented the wheel here. IBM mainframe computers from 1960s atleast had water cooled processors, Cray super computers had liquid nitrogen cooled processors.

Point is, when those guys switched to CMOS chips the power consumption dropped by orders of magnitude and it is only very absolute top end machines that use liquid cooling!

So, back to the future!
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Post by jamwal »

Theo_Fidel wrote:
Pandaland is a play of 2 sectors, manufacturing and construction. That is it. There is no space for anything else.

P.S. If this entire gravity defying spectacle should stop that army of 200 million+ will be quite spectacular. It must be remembered that the SKorean generals learnt this the hard way when there dock worker went unemployed in the 80's.
Why do you think that these workers will be unemployed in foreseeable future except for controversial talks of ghost cities and inviable railways ?
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Post by RamaY »

A bunch of sour grapes - for these iRAPEan foxes

Beebs: Why China won't save the world
From all the breathless speculation you'd think that was on the cards. The talk is all about how "China can save the world", or ride in and "rescue the Eurozone".
...
To put things in perspective, for all China's rise, its economy accounts for less than 10% of global GDP at present, while the developed nations of Europe and America make up well over 50%.

It is Europe - even in a time of crisis - that does much to power China's rise, rather than the other way round. Europe, we all know, is China's biggest export market. Last year it bought 280bn euros of Chinese goods.

A new downturn in Europe would hit China hard. At the giant China import-export fair in Guangzhou this week almost everyone I spoke to said orders from Europe are falling and that's hurting China's exporters.

By contrast, some say, China is a drag on Europe. It sells far more to Europe than it imports from it, and that is not going to change overnight. Only Germany has serious trade with China, as it makes the machinery and motor vehicles Beijing is buying in large quantities.

China isn't investing much in Europe either - less than 1bn euros last year. That was little more than 1% of foreign investment in Europe, which pumped five times as much into China.

While many outside China view its leaders as strong, masters of a rising power, many in China see them as cautious, consensual, hemmed in by problems at home. President Hu has just a year left before he's due to step down, so he's unlikely to take radical decisions right now.
Read it all :rotfl:
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Post by member_20021 »

<"China can neither take up the role as saviour to the Europeans, nor provide a 'cure' for the European malaise," said the state-run Xinhua news agency at the weekend.>

Obviously China knows her place in the world, a developing country.
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Post by ArmenT »

Hu Jintao is scheduled to step down from power fairly soon. He wants to be known in history as the person who brought China forward, not the person who ruined China's economy by bailing out the Europeans. He's probably going to leave that problem for the next Chinese leader to solve.
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Post by member_20021 »

ArmenT wrote:Hu Jintao is scheduled to step down from power fairly soon. He wants to be known in history as the person who brought China forward, not the person who ruined China's economy by bailing out the Europeans. He's probably going to leave that problem for the next Chinese leader to solve.
Yeah, Hu's motto has been "not-screwing-up", consistent with his training as a hydro engineer :) . The succeeding Xi is a chemical engineer, who may bring some drastic changes to China. :D
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Re: PRC Economy and Industry: News and Discussions

Post by abhischekcc »

chola wrote:You are nowhere near the first.
I was a China bear since 1999, when I first came on this forum. You were not even present then.
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Post by Pratyush »

well it is quaint to see BRFites squabbling amongst each other about being original PRC Bear. However, the fact remains that the PRC is still the fastest growing economy in the world (Disclaimer:- If the numbers are to be believed.) It will not succeed in toppling the established order without major help from "an also ran India" (Thank heavens for that).

The point that I am trying to make is in the long run you will always have a bust. Sheik CC has been claiming a PRC bust since 99. I am a lille one compared to him. Chola has been since 2003??. It is still to see a major restructuring. It it comes it may happen in 2013 or 15, or whenever. So bulls and bears please declare peace not piss at each other and call it a day.

PS the bull markets collapses when the last bear leaves the market. I remember reading it some where, don't recall where, bliss to go easy on me.
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Post by abhischekcc »

Pratyush,

I was not claiming a bust since 1999. I was claiming that China's growth is not as much as they say, and India's growth is not as little as GOI says.

The controversies over China's fudged stats, falling ICOR, ghost towns, astronomically large but empty shopping malls came years later.
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Post by abhischekcc »

My favourite read on the Chinese economy is/was Andy Xie, and he happens to be an extreme China bull. :)

Look, East Germany/USSR were considered great economic powers until they collapsed. Non government economists had been calling out the weakness of USSR economy since 70s, some since 60s, but they were not proved right until 1991.
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Post by Pratyush »

That would be the origin of Shanghai Stats I presume?
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Post by abhischekcc »

Shanghai stats should really be called commie stats, or more precisely - secular stats.
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Post by wrdos »

abhischekcc ji

Why don't you bother to share with us more insights of you about the China Stats.
You claimed, China overestimates her GDP.

OK, i assume all of us know that a country's GDP consists of 3 parts,
1)Net-export (export-import), 2)Government spending and Investment, and 3)Domestic Consumption.

So according to you, China is over reporting which part of her GDP (1, 2 or3) and at what a scale (to say 20%, 30%, 100% and so on)?
abhischekcc wrote:Pratyush,

I was not claiming a bust since 1999. I was claiming that China's growth is not as much as they say, and India's growth is not as little as GOI says.

The controversies over China's fudged stats, falling ICOR, ghost towns, astronomically large but empty shopping malls came years later.
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Post by Singha »

NYtimes

The Privileges of China’s Elite Include Purified Air
By ANDREW JACOBS
Published: November 4, 2011


BEIJING — Membership in the upper ranks of the Chinese Communist Party has always had a few undeniable advantages. There are the state-supplied luxury sedans, special schools for the young ones and even organic produce grown on well-guarded, government-run farms 8) . When they fall ill, senior leaders can check into 301 Military Hospital, long considered the capital’s premier medical institution.

But even in their most addled moments of envy, ordinary Beijingers could take some comfort in the knowledge that the soupy air they breathe on especially polluted days also finds its way into the lungs of the privileged and pampered.

Such assumptions, it seems, are not entirely accurate.

As it turns out, the homes and offices of many top leaders are filtered by high-end devices, at least according to a Chinese company, the Broad Group, which has been promoting its air-purifying machines in advertisements that highlight their ubiquity in places where many officials work and live.

The company’s vice president, Zhang Zhong, said there were more than 200 purifiers scattered throughout Great Hall of the People, the office of China’s president, Hu Jintao, and Zhongnanhai, the walled compound for senior leaders and their families. “Creating clean, healthy air for our national leaders is a blessing to the people,” boasts the company’s promotional material, which includes endorsements from a variety of government and corporate leaders, among them Long Yongtu, a top economic official who insists on bringing the device along for car rides and hotel stays. “Breathing clean air is a basic human need,” he says in a testimonial.

In some countries, the gushing endorsement of a well-placed official would be considered a public relations coup. But in China, where resentment of the high and mighty is on the rise, news of the company’s advertising campaign is fueling a maelstrom of criticism. “They don’t have to eat gutter oil or drink poisoned milk powder and now they’re protected from filthy air,” said one posting on Sina Weibo, the country’s most popular microblog service. “This shows their indifference to the lives of ordinary people.”

News that Chinese leaders are largely insulated from Beijing’s famously foul air comes at a time of unusually heavy pollution in the capital. In recent weeks, the capital has been continuously shrouded by a beige pall and readings from the United States Embassy’s rooftop air monitoring device have repeatedly registered unsafe levels of particulate matter.

But those very readings, posted hourly on Twitter or through an iPhone app, have prompted a public debate over whether the Chinese government is purposely obscuring the extent of the nation’s air pollution. Unlike the American Embassy readings, Chinese environmental officials do not publicly release data on the smallest particulates, those less than 2.5 micrometers, which scientists say are most harmful because they are able to penetrate the lungs so deeply. Instead, government data covers only pollutants larger than 10 micrometers —a category that includes sand blown in from the arid north and dust stirred up from construction sites.


Environmental officials prefer to focus on air quality improvements of recent years, largely achieved by replacing coal-fired stoves with electric heaters and closing heavy industry in and around the capital. Driving restrictions have slightly eased the environmental injury of the 700,000 new vehicles that last year joined the capital’s jammed roadways.

But when pressed, those same officials acknowledge that their pollution metrics willfully ignore the smaller particles, much of them generated by car and truck exhaust. In fact, the American Embassy’s monitor has become an unwelcome intrusion into China’s domestic affairs, according to a diplomatic cable released this year by WikiLeaks, which said a Foreign Ministry official had requested that the Americans stop publicizing the data. :rotfl:

The director of the Institute of Public and Environmental Affairs, a nonprofit organization in Beijing, said many government officials feared that publicly revealing such data could stymie development or dent the image of cities that had been trumpeting their environmental bona fides.

“I don’t agree with this philosophy,” said the director, Ma Jun. “The government’s more urgent priority should be to warn the public when the air quality is dangerous so people susceptible to poor air quality, like children or the elderly, can make decisions to protect their health.”

The government does appear to be moving in that direction. In September, the Ministry of Environmental Protection said it planned to amend the nation’s air quality standards to include the smallest particulates, although it has not released a timetable for adopting the new standards.

Officials in Beijing, however, are apparently not quite ready to embrace it. In response to criticism over the heavy smog of recent weeks, a spokesman for the city’s environmental protection bureau, Du Shaozhong, assured the public that they should feel secure in the government’s own readings, which termed the city’s air “slightly polluted” even as the embassy monitor found it so hazardous that it exceeded measurable levels. “China’s air quality should not be judged from data released by foreign embassies in Beijing,” he said.

According to the Broad Group’s Web site, it did not take much to convince the nation’s Communist Party leaders that they would do well to acquire the firm’s air purifiers, some of which cost $2,000. To make their case, company executives installed one in a meeting room used by members of the Politburo Standing Committee. The deal was apparently sealed a short while later, when technicians made a show of cleaning out the soot-laden filters. “After they saw the inklike dirty water, Broad air purifier became the national leaders’ appointed air purifier!” the Web site said.

Edy Yin contributed research.
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Re: PRC Economy and Industry: News and Discussions

Post by abhischekcc »

40%
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Post by Christopher Sidor »

Recently I saw the BBC program, Tropic of Cancer, which had travels along the Tropic of Cancer. On the Laos -Chinese border, The chinese are building a massive casino and other entertainment infrastructure. They are expecting some 2 lakh visitors to these complexes. Most of them are expected to be Chinese. This is a work in progress, and if it succeeds then it might make a dent in the narcotics trade originating from the Golden Triangle. Mind numbing assumptions by any yardstick. :eek: :eek: :eek:

Now let us rewind to another era, an era of 1985-1992. Japan bought massive hotels, casinos, and other infrastructure in Western USA. So much so that it was speculated that half of California was owned by the Japanese. Japanese did this after they became a middle income country and were transitioning into the top 10 countries by Per-Capita-Income criteria. Funny part on how that story played out. Most of the Japanese companies had to sell the same buildings/properties that they bought at a loss to other companies. For example the Pebble Beach Resort of California was bought by the Japs for a sum of approximately 800-900 million USD. They sold it at a loss of approximately 300-400 million USD.

The problem with foreign real estate and foreign manufacturing units is simple. The owner cannot simple uproot the asset from one place and take it to the other. This is one of the reason that capital investment is known as sunk-in-cost.
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Re: PRC Economy and Industry: News and Discussions

Post by wrdos »

abhischekcc wrote:40%
Then which sector: Net-export, investment, or consumption?
And which year: At 1999 or 2010?
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Re: PRC Economy and Industry: News and Discussions

Post by Theo_Fidel »

Abhiji,

Don't bother with the troll. This is standard tactic taught by CPC overlords to underlings. Don't supply info but challenge/deny everything.
---------------------------------------------

http://www.theepochtimes.com/n2/china-n ... 63563.html
When the Railways Ministry couldn’t meet payments on the more than 130 billion yuan (US$20.46 billion) owed to two major railway construction giants, China Railway Construction Corporation Limited and China Railways Group Limited, most projects were halted, Wang told Yangcheng Evening News on Oct. 27.

Wang also said that many migrant workers have not been paid for six months, and in China Railways Group Limited alone, over 2,000 migrant workers were demanding or protesting their unpaid wages.


Additionally, tens of thousands of people working on the Langyu Railway, a major track from Langzhou in Gansu to Chongqing, were owed wages totaling 300 million yuan (US$47.19 million), and were protesting to demand unpaid wages, according to The Economic Observer.

The scale of this work disruption is unprecedented in China’s railway history, a high-level official from a large state-owned engineering company told The Economic Observer. Once a project stops, it triggers a domino effect; many parties, including migrant workers, construction companies, and the equipment and materials suppliers are all affected, he said.
State mouthpiece Xinhua said on Nov. 1 that the Ministry of Railways will get more than 200 billion yuan (US$31.5 billion) of financial support to improve liquidity, according to sources within the ministry, but didn’t name the source of the bail-out money. This past year has also seen the Ministry of Railways plagued by scandals related to corruption and poor construction quality.

Liu Zhijun, the former minister of Railways was removed from his job in February and jailed for amassing a private fortune of US$120 million, leaving behind a legacy of mismanagement and debt. Soon after, Zhang Shuguang, a former deputy chief engineer of the Ministry, was sacked and accused of funneling US$2.8 billion into his offshoe bank account. The scandals have tarnished the Ministry’s reputation. Banks have refused to finance its projects or have been asking for higher interest rates, according to First Financial Daily. In August, the Ministry published its financial statements for the first half of 2011, reporting debts in excess of 2.09 trillion yuan (US$328.88 billion), with a debt ratio of 58.53 percent.

The financial shortfall is not the Ministry’s only problem. The bullet train crash on July 23 also created public doubt and outrage. One former Railway Ministry engineer told The Epoch Times that the crash exposed a lot of problems, causing many people to realize that the Railways Ministry is a bottomless money pit, and as a result, financial backing has dried up.
Almost like a bad omen, a locomotive caught on fire early on Nov. 2, the day after the bail-out announcement, when a train was on its way from Tianjin in Hebei Province to Hankou in Hubei Province. The Jingguang Railway, a major railway in China, was shut down for almost an hour as a result.
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Post by wong »

^^^^^

LOL,
Epoch Times = Falun Gong Newspaper, hardly impartial journalism
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Re: PRC Economy and Industry: News and Discussions

Post by chola »

We need to see China as it really is. A piss-poor nation where tens of millions live in caves.

http://www.chron.com/opinion/outlook/ar ... 250889.php
Up to 40 million Chinese people still live in caves. That's more than the populations of Texas and Illinois, combined. In fairness, a fraction of these caves are apparently pretty nice, complete with electricity and well-compacted dirt floors. But that's grading on a curve because, well, they're still caves.

,,,,,,,,,,,,,,,,,,,,

The reason China has invested massively in infrastructure is simply that it has relatively little of it. America has 5,194 airports with paved runways. That's more than 11 times China's 442. In fact, you can add up the paved airports of the next 10 countries combined, and America beats them with more than a thousand airports to spare. We have nearly twice the roadways China does and almost three times the railways.
The vast majority of it population lives far more like Sudan than Shanghai.

As a piss-poor country, it can grow its infrastructure for a very long time and still find use for them.

We are disappointed time and again by our predictions of Pandaland's economic demise because we attribute first world problems to it like oversupply of housing, railroads and money supply. They grow for the same reasons India is growing. Poor nations can grow for a very long time and building infrastructure is the best way to improve populations lacking in everything.

I've learn long ago that to not let wishful thinking overwhelm analysis. If we are happy that China is actually poorer than it really is (courtesy of phony statistics) then we should also understand that infrastructure building is healthy for poor nations. We cannot then say that the empty cities and empty roads are not needed as if China were already wealthy. Poor nations grow into infrastructure because no one wants to live in a cave forever.

Poverty is a stigma for the present but it has great advantages for growth. Trying to both pin the stigma of poverty and oversupply problems from the wealthy first world on the panda makes no sense.

So Abhi-ji, if you were a China bear since 1999 then you would have been wrong for even longer than I have.
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Re: PRC Economy and Industry: News and Discussions

Post by gakakkad »

IMHO it is not about bulls or bears or statistics.. The actual GDP of Panda is hardly important.it is about sustainability and usability..if i put UP/Bihar villagers in a high rise noida luxury apartment and give them a car , the economy wont improve...it ll become unsustainable... the poor farmer does not have the employable skills to be able to achieve productivity needed for that lifestyle..he ll not even be able to pay the light-bill..after a while it ll become unsustainable...and will have to stop..imagine doing this for over a billion people.. how long can it sustain it...

there has been ample evidence of poor quality of the majority of infra it builds... only shanghai and other cities which are important for h & d have decent infra.. it cannot last forever... i think it is immaterial whether the GDP is 3,6 or 60 trillion .. that is merely a meaningless number...
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Re: PRC Economy and Industry: News and Discussions

Post by abhischekcc »

chola, I don't you read what I wrote earlier - I have always held that the Chinese economy is not not doing as well as advertised. I also gave examples of USSR and east germany - how their economies went on for 40 years on nothing but bullshit before finally collapsing. China is in the same mode. We will only know the true extent of their economic hollowness once the current model (export oriented, low currency) comes to its logical conclusion.

They can build as many shiny malls they want, but if they are not economically viable, ultimately it will come and bite them in the behind. A lot of people will loss their undergarments in China (having already lost their shirts in US :mrgreen: )
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Re: PRC Economy and Industry: News and Discussions

Post by RamaY »

I notice that lot of chinece are investing US RE as they think it is more safer and give better ROI. I think this is an indication of coming days in PRC. Something is cooking if the low-rich strata too start investing a lot outside their home country.
ashi
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Re: PRC Economy and Industry: News and Discussions

Post by ashi »

China Hard Landing Call Getting Crowded Out
Those waiting for a China hard landing are going to have to wait a lot longer. China’s equity market is beating the MSCI Emerging Markets Index, the S&P 500 and State Street’s SPDR Gold (GLD) exchange traded fund over the last month. China is not going to have a hard landing any time soon, and probably never; not with more money in foreign cash reserves than most countries’ GDP, a command and control economy ruled from Beijing, and new leadership taking over next year who are clearly not interested in social unrest, unemployment, and uncontrolled housing bubbles.

The China hard landing call is wilting.
It seems people actually want to see shock and awe business failure in China. With China only having 75% of their roads paved, there will be years of more construction work and earth moving going on, according to the U.S. China Business Council in Washington.
“China will continue to grow, but perhaps not as fast,” says Mark Mobius, the executive chairman of Templeton Emerging Markets funds. Mobius posted a video interview on his website on Oct. 28, saying despite the end of double digit growth, “the growth rate will still be very high. The government policies are designed to assure high growth and the incentives in the population to innovative and make money are very high.”
chola
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Re: PRC Economy and Industry: News and Discussions

Post by chola »

abhischekcc wrote:chola, I don't you read what I wrote earlier - I have always held that the Chinese economy is not not doing as well as advertised.
We have all done that on BR. There is nary a person here who was not a pandaland bear then or is not a pandaland bear now. What have that gained us? The chini economy grows relentlessly while the Germans, Japanese, Koreans and Taiwanese along with GM and Apple attack and dominate this market.

I also gave examples of USSR and east germany - how their economies went on for 40 years on nothing but bullshit before finally collapsing. China is in the same mode.
The USSR and East Germany were always thought of as backwaters. Communism was and is considered an economic failure as long as I lived. I grew up during the Reagan years where we knew instinctively that the USSR and East Germany were piss poor.

What they did have were lots of weapons and human wave tactics and that was what was scary. Not their economies which were always a joke. Their women athletes with male hormones were scary too. But not their economies.

The threat from chiniland to the US is from a totally different angle. The USSR and East Germany never had close to $3T worth of hard Western currency.
We will only know the true extent of their economic hollowness once the current model (export oriented, low currency) comes to its logical conclusion.
The exported oriented model worked more than well enough for Japan, Germany, South Korea, Taiwan, Thailand, Singapore and Hong Kong. Compare their per capita income to ours. The chini are traveling this same path but with an inefficient communist government.

It is not their economic model that is hollow. It is their political system. That is what will crush them like the USSR and East Germany not their economic system which is unlike anything the Soviets/East Germans had.

As I wrote previously, I hope they keep being communist for as long as possible. Because if you pair a freely elected government with a free market, you get Japan or South Korea writ large.
They can build as many shiny malls they want, but if they are not economically viable, ultimately it will come and bite them in the behind. A lot of people will loss their undergarments in China (having already lost their shirts in US :mrgreen: )
If it were all non-functional malls, I would agree with you. The problem for us is they are building housing and roads. For piss poor nations, building infrastructure is always good. The problem with poor nations is the lack of resource to build to build enough not overbuilding which is the problem of wealthy nations.
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Re: PRC Economy and Industry: News and Discussions

Post by Christopher Sidor »

China Credit Squeeze Prompts Suicides, Violence -- Bloomberg Dated 6-Nov-2011

From the article
Small and medium-sized businesses account for 80 percent of jobs in China, according to the country’s industry ministry. Yet they’re largely unable to get loans from banks, which prefer collateral to cash-flow, according to an Oct. 17 report by Sydney-based investment bank Macquarie Group Ltd.
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The residents turned money lending into a cottage industry, according to interviews with six of them. They built a lattice of interlocked credit, often borrowing from banks and other private lenders to arbitrage interest rates. Taking out bank loans at 1 percent a month, many lent out their cash for 2 percent or higher a month. They pocketed the difference to supplement meager income from odd jobs.
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Some used their housing as collateral.
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The collateralization of homes means problems may stretch back to the banks. One-third to a half of money used for private lending originally comes from banks, said Lu Ting, an economist with Bank of America Corp.’s brokerage unit. Tightening cash flow for businesses continues to raise the risk of bank loans going bad, according to a statement from Wenzhou’s Financial Office given to Bloomberg News on Oct. 21.
Talk about leverage. And here I was thinking that it is only the irresponsible north-atlantic nations which live off leverage. This leverage is used in China and to a very large extent in India too. It seems that leverage is more universal then it is generally assumed. It is just that the north-atlantic countries have a more structured form. Whereas we in Asia are still to develop it in a more formal mechanism. There have been cases where a house/plot has been sold in Ghaziabad, NCR to buy a flat in Gurgaon, NCR just so as to take advantage of higher appreciation in Gurgaon compared to Ghaziabad. And funny part was that the house/plot being sold in Ghaziabad, NCR was bought by a person who wanted to sell it down the line to another person and pocket a neat 20% return in 6 months. All in Black. So both the buyer and seller were basically speculating and driving up the prices. There was no final end-user of the property in sight anywhere.
In Gujarat there are many such informal lending practices in vogue. People take money say 6-10 lakhs from many different individuals and promise to give a return of say 20k per quarter or more. They invest in the money is shops, in factories and sometimes in real estate too. All of this is off the books and in black, the money lent and the interest returned with no collateral and no oversight. Only on the basis of the word of a few people.
Black market rates have doubled this year, far exceeding the return of companies in Wenzhou that typically have wafer- thin profit margins, according to Ren Xianfang, a Beijing-based economist with IHS Global Insight Ltd.
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Curb lenders demand annual interest of between 20 percent and 40 percent or higher, many times the official lending rate of 6.56 percent a year, UBS’s Wang said. The rate rose as China’s new bank loans decreased, down to a 21-month low of 470 billion yuan in September.
:eek: :eek: :eek:
This is the same interest that is charged for rolling over credit-card interest. And wafer thin margins? I am hearing more and more about this from many places, with regard to the panda's economic model.
Analysts are trying to ascertain how effective the measures are and how widespread the fallout from Wenzhou will be across China. The city is now the country’s biggest source of private capital, marshaling about 800 billion yuan, equivalent to 2 percent of China’s total economic output, according to Ren of IHS Global. Money from Wenzhou is invested in everything from real estate in Dubai to coal mines in Shanxi province, in China’s northwest.
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Others see Wenzhou as symptomatic of broader problems, such as an over-reliance on investment to grow the economy that steers money toward state-owned companies, said Michael Pettis, the Beijing-based chief strategist at Guosen Securities Co. “You can solve Wenzhou, but you’re simply transferring the problem someplace else,” he said.
Maybe the CPI, CPM and other communists are right after all. We have much to learn from china. Especially on how not to force the industry which caters to approximately 80 % of the jobs into the hands of loan sharks and dubious lending practices.
8) 8)
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Re: PRC Economy and Industry: News and Discussions

Post by Asit P »

Property Prices Collapse in China. Is This a Crash?

What If the China Bubble Bursts?

Although these articles are based upon some assumptions. However, two things which are quite evident are :

(1). There are quite a few chinks in the Chinese growth model
(2). If China goes down, USA will suffer too.
ashi
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Re: PRC Economy and Industry: News and Discussions

Post by ashi »

China's rapid inflation cools
Over the past year, China's government has enacted various measures to curb rapidly rising prices, without sacrificing economic growth. So far, those efforts seem to be working.
"Prices on everything from rents to haircuts, have decelerated somewhat in the last few months, and I think it is a good sign," said Sung Won Sohn, economics professor at Cal State University Channel Islands. "That's exactly what the government has been trying to deliver."
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Re: PRC Economy and Industry: News and Discussions

Post by wong »

^^^^
Leave it. Apparently China has outsourced "climbing the wall of worry" to India for free. These guys are the best contrarian indicator, which is why I visit. Meanwhile the China-India spread widens every year. After all, how many years have they been dead wrong about China, five, ten or twenty??? I would only worry about China when these guys capitulate.
Theo_Fidel

Re: PRC Economy and Industry: News and Discussions

Post by Theo_Fidel »

http://www.cnbc.com/id/45184275/China_s ... al_Outlook
“The primary motivation for Chinese buyers is to export wealth out of the country, it’s not a financial decision at all,” according to George Varvitsiotis, managing director of Propgoluxury.com, a luxury real estate web portal with a stall at the event.

“They prefer luxury properties because they can transfer large amounts in one go.” He says this trend only began a couple of years ago and has accelerated rapidly.

But it’s not just assets that the wealthy want to move offshore. About 60 per cent of rich Chinese people have already begun the process of emigrating or are considering doing so, according to a survey of people with more than Rmb10 million ($1.6 million) in personal wealth, released this week by Bank of China and rich list publisher Hurun Report. The results echo those of an earlier survey by Bain & Co, while anecdotal evidence suggests the number looking to leave China permanently or at least secure foreign citizenship has spiked in the last year or so.
“You can feel the anxiety of the ultra-wealthy and even of the political elite. They feel there’s no security for their wealth or possessions and that their assets could be taken away at any time,” says Hung Huang, a publishing and fashion mogul. “Nobody feels protected against the system any more.”
In private conversations, many of the people who supposedly make up the ruling elite of China express serious misgivings about the direction and future stability of the country, while admitting that they feel largely powerless to affect meaningful change.

There is a sense that we are approaching an inevitable breaking point, when the pressures in society will boil over and consume the rulers,” says one Chinese banker with close ties to a number of powerful political families.

“Almost all of the elements are in place for an uprising like we saw in 1989 – corruption is worse today than it was then, people feel they can’t get ahead without political connections, the wealth gap is much bigger and growing and there has been virtually no political reform at all. The only missing ingredient now is a domestic economic crisis.”
Christopher Sidor
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Re: PRC Economy and Industry: News and Discussions

Post by Christopher Sidor »

wong wrote:^^^^
Leave it. Apparently China has outsourced "climbing the wall of worry" to India for free. These guys are the best contrarian indicator, which is why I visit. Meanwhile the China-India spread widens every year. After all, how many years have they been dead wrong about China, five, ten or twenty??? I would only worry about China when these guys capitulate.
Care to give us figures for this so called "spread" ??
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