Survivalist Forum banner
  • Are you passionate about survivalism? Would you like to write about topics that interest you and get paid for it? Read all about it here!
1 - 20 of 42 Posts

·
Registered
Joined
·
7,547 Posts
Discussion Starter · #1 ·
Good article on the financial and demographic challenges the chicoms are faced with.

 

·
Registered
Joined
·
5,876 Posts
Generally every point given in the article also happened to the U.S. and other countries, and may be part of late capitalism: population aging, increasing debt, polllution, financial bubbles, social credit systems, infra deterioration, deficit spending, etc. The difference is that China does not appear to be interested in superpower status, as that would lead to soaring debts, which is what happened to the U.S. That's why the U.S. has to spend heavily on the military, because the main source of funding for that and for the economy itself is world reliance on the dollar as a reserve currency. That's also why China and others prefer SDRs involving a basket of currencies.

Given that, China will very likely operate as part of BRICS with over forty emerging markets engaged in combinations of bilateral trade, and many of those markets will eventually take over.

If any, that appears to be the trend across more than a century: Britain and others ruled until the U.S. took over, then Japan and others gained while the U.S. began to outsource, then the Japan too did the same, together with Asian "tiger" economies, then a decade ago China began outsourcing in turn as its work force started moving to service industries, and after that groups of countries involving Bangladesh, Nigeria, and the Philippines may take over.
 

·
Registered
Joined
·
13,591 Posts
Generally every point given in the article also happened to the U.S. and other countries, and may be part of late capitalism: population aging, increasing debt, polllution, financial bubbles, social credit systems, infra deterioration, deficit spending, etc. The difference is that China does not appear to be interested in superpower status, as that would lead to soaring debts, which is what happened to the U.S. That's why the U.S. has to spend heavily on the military, because the main source of funding for that and for the economy itself is world reliance on the dollar as a reserve currency. That's also why China and others prefer SDRs involving a basket of currencies.
Holy cow, you're full of baloney.

The US spends less than 4% of GDP on the military and defense. That's a lower percentage than Russia, Saudi Arabia or Israel.

Military spending isn't destroying anything.

On the other hand, the Feds paid 5.5% of the GDP for health care directly, over $11,000 per person, while American's spend over 17% of the GDP on health care outside o the Federal system.
 

·
Registered
Joined
·
322 Posts
Might want to pay attention to a 'little' Chinese company called 'Evergrande'. Depending who one listens to, they have anywhere from $100 Bil in dollar denominated bonded indebtedness all the way up to $400 Bil on dollar denominated debt. Evergrande is teetering right on the edge of going bankrupt. They are China's largest property developer/builder and NOBODY has a firm handle on what the CCP is going to do with this can of worms.

A lot of those bonds are actually embedded into Western financial system through what are called "Index Funds". What Are Index Funds?

Today, a lot of Evergrande's funds on the exchanges are holding at approximately $0.30 - $0.37 on the dollar. - That means they have lost approx. 2/3rds of their original value & it's likely to get worse. IF Evergrande goes bankrupt, well, then it's into the Chinese court system, and that means Western debt holders are at the end of a really long line.

We have already seen (just this last week) a substantial amount of Western debt holders of Chinese corporations working to dump their positions without totally tanking the market. IMO, it's probably too late. The next several weeks could see a substantial amount of Chinese ADR's and debt instruments getting the 'fire sale' treatment.

This whole effect could be incredibly brutal, especially with an already crippled supply chain. All this trade has to have collateral - What happens if all sudden much of the 'collateral' loses a substantial portion of it's value?

Many more questions than answers......
 

·
Registered
Joined
·
3,573 Posts
Might want to pay attention to a 'little' Chinese company called 'Evergrande'. Depending who one listens to, they have anywhere from $100 Bil in dollar denominated bonded indebtedness all the way up to $400 Bil on dollar denominated debt. Evergrande is teetering right on the edge of going bankrupt. They are China's largest property developer/builder and NOBODY has a firm handle on what the CCP is going to do with this can of worms.

A lot of those bonds are actually embedded into Western financial system through what are called "Index Funds". What Are Index Funds?

Today, a lot of Evergrande's funds on the exchanges are holding at approximately $0.30 - $0.37 on the dollar. - That means they have lost approx. 2/3rds of their original value & it's likely to get worse. IF Evergrande goes bankrupt, well, then it's into the Chinese court system, and that means Western debt holders are at the end of a really long line.

We have already seen (just this last week) a substantial amount of Western debt holders of Chinese corporations working to dump their positions without totally tanking the market. IMO, it's probably too late. The next several weeks could see a substantial amount of Chinese ADR's and debt instruments getting the 'fire sale' treatment.

This whole effect could be incredibly brutal, especially with an already crippled supply chain. All this trade has to have collateral - What happens if all sudden much of the 'collateral' loses a substantial portion of it's value?

Many more questions than answers......
And likely this will only increase the calls within the CCP for even more central planning.
That's not a recipe for long term succes.
 

·
Pisticus Veritas
Very Prepared!!
Joined
·
34,859 Posts
I'm assuming that China owns a lot more American real estate than America owns Chinese real estate. On paper, China may appear to be in trouble and they probably are but America is in debt to the tune of 30 trillion dollars. Stack 30 trillion 1 dollar bills on one another and we may have a ladder to Pluto. America is being run by a delusional potato (we'll call him President Potato Head) who's actually a puppet of a powerful group of anti-American Marxists. America is also in the midst of an ideological and racial civil war.

So who's in more trouble. China or America?
 

·
Registered
Joined
·
7,547 Posts
Discussion Starter · #8 ·
Might want to pay attention to a 'little' Chinese company called 'Evergrande'. Depending who one listens to, they have anywhere from $100 Bil in dollar denominated bonded indebtedness all the way up to $400 Bil on dollar denominated debt. Evergrande is teetering right on the edge of going bankrupt. They are China's largest property developer/builder and NOBODY has a firm handle on what the CCP is going to do with this can of worms.

A lot of those bonds are actually embedded into Western financial system through what are called "Index Funds". What Are Index Funds?

Today, a lot of Evergrande's funds on the exchanges are holding at approximately $0.30 - $0.37 on the dollar. - That means they have lost approx. 2/3rds of their original value & it's likely to get worse. IF Evergrande goes bankrupt, well, then it's into the Chinese court system, and that means Western debt holders are at the end of a really long line.

We have already seen (just this last week) a substantial amount of Western debt holders of Chinese corporations working to dump their positions without totally tanking the market. IMO, it's probably too late. The next several weeks could see a substantial amount of Chinese ADR's and debt instruments getting the 'fire sale' treatment.

This whole effect could be incredibly brutal, especially with an already crippled supply chain. All this trade has to have collateral - What happens if all sudden much of the 'collateral' loses a substantial portion of it's value?

Many more questions than answers......
Saw that article yesterday
 

·
Registered
Joined
·
506 Posts
I'm assuming that China owns a lot more American real estate than America owns Chinese real estate.
Safe assumption. Our property rights can trace their lineage to the vikings that took over England. China has none, CCP owns everything. You are simply leasing the land, and if they want to raze your apartment building in the name of progress, they will (and do).
 

·
Registered
Joined
·
322 Posts
I'm assuming that China owns a lot more American real estate than America owns Chinese real estate. On paper, China may appear to be in trouble and they probably are but America is in debt to the tune of 30 trillion dollars. Stack 30 trillion 1 dollar bills on one another and we may have a ladder to Pluto. America is being run by a delusional potato (we'll call him President Potato Head) who's actually a puppet of a powerful group of anti-American Marxists. America is also in the midst of an ideological and racial civil war.

So who's in more trouble. China or America?
Best answer is two fold: (1) Depends how you look at the numbers.. And.... (2) "Are the numbers valid?"

First off, little, if any of that Chinese owned US real estate is owned by the CCP. That would be the equivalent of fiscal suicide for China.

Second, having huge amount of dollar denominated debt owed to US investors via bonds and ADR's, and then having the 'collateral' for all those investments turn out to be worth less than the paper they are printed on would likely lead to devastating crashes in Wall Street (stock market, bond market, and possibly the derivatives markets (CDO's, CLO's, etc.)
What are "Derivatives" (Financial)?

We are likely to find out very shortly exactly how smart the C-Suite leadership is at a lot of US companies with a China presence.

My betting: Not very smart.....

That being said, China (CCP) has a lot bigger problem. They need US dollars. LOTS & LOTS of them. And they are not getting the massive Western capital inflow any more. Western Investors are wising up. Wall Street types are already referring to this situation as "China's Lehman Moment"..
China's Lehman Brother Moment
 

·
Live Secret, Live Happy
Joined
·
16,610 Posts
The article highlights the big, self induced demographic problem that is almost unique to China. The one child policy produced fewer children, and many fewer girls. Fewer Chinese girls equalls fewer Chinese families and there is no way to fix this.

Without massive imigration the Chinese population will drop, and they will slide back to the communist swamp. All we need to do is not bail them out financially, or sell them any farm produce.

A desperate nation is at it's most dangerous, and they will become more and more desperate as their population drops.
 

·
Registered
Joined
·
7,547 Posts
Discussion Starter · #13 ·
Holy cow, you're full of baloney.

The US spends less than 4% of GDP on the military and defense. That's a lower percentage than Russia, Saudi Arabia or Israel.

Military spending isn't destroying anything.

On the other hand, the Feds paid 5.5% of the GDP for health care directly, over $11,000 per person, while American's spend over 17% of the GDP on health care outside o the Federal system.
ENTITLEMENT Programs are the problem. Look it up.
 

·
Registered
Joined
·
5,520 Posts
Might want to pay attention to a 'little' Chinese company called 'Evergrande'. Depending who one listens to, they have anywhere from $100 Bil in dollar denominated bonded indebtedness all the way up to $400 Bil on dollar denominated debt. Evergrande is teetering right on the edge of going bankrupt. They are China's largest property developer/builder and NOBODY has a firm handle on what the CCP is going to do with this can of worms.
Looks like they are going bankrupt


We'll see if this sparks a chain reaction. If it does, it may spell trouble in the US as well
 

·
Si Vis Pacem, Para Bellum
Joined
·
11,386 Posts
I'm assuming that China owns a lot more American real estate than America owns Chinese real estate. On paper, China may appear to be in trouble and they probably are but America is in debt to the tune of 30 trillion dollars. Stack 30 trillion 1 dollar bills on one another and we may have a ladder to Pluto. America is being run by a delusional potato (we'll call him President Potato Head) who's actually a puppet of a powerful group of anti-American Marxists. America is also in the midst of an ideological and racial civil war.

So who's in more trouble. China or America?
You may call him president. I do not recognize his authority since the election was stolen, so I call him a communist thief.
 

·
Registered
Joined
·
322 Posts
The hits just keep on coming.......

In an exchange filing on Thursday, Evergrande's main unit (onshore real estate) said that trading in all of its onshore bonds would be suspended on Sept 16 to ensure fair information disclosure following a downgrade to A from AA (which in China is viewed as the lowest investment grade rating) by China Chengxin International, to wit:

In order to ensure fair information disclosure and protect the interests of investors, after the company’s application, all existing corporate bonds of Evergrande Real Estate will be suspended for one trading day from the opening of the market on September 16, 2021, and will be opened on September 17, 2021.
ALL Evergrande bonds; both onshore & offshore are suspended.

13 years to the day from Lehman Brother's bankruptcy filing.....

Now, it's time to find out who in the West is going to be stupid enough to purchase Chinese corporate bonded indebtedness going forward?

The only reason I can think to do that is if you had already shorted a Chinese corporate bond issue and it was time to buy it back to successfully exit your short position.

Another concern may be that since Evergrande bonds had been considered as high level 'investment grade', it WAS likely used as collateral for international trade or other financial instruments, Now all of that has to be backed out ASAP. And both sides have to agree on the new (replacement) collateral - and getting that agreement may be tough.

The late Hunter S. Thompson may have called this situation correctly:
Moar popcorn, please....
 

·
Registered
Joined
·
5,876 Posts
I'm assuming that China owns a lot more American real estate than America owns Chinese real estate. On paper, China may appear to be in trouble and they probably are but America is in debt to the tune of 30 trillion dollars. Stack 30 trillion 1 dollar bills on one another and we may have a ladder to Pluto. America is being run by a delusional potato (we'll call him President Potato Head) who's actually a puppet of a powerful group of anti-American Marxists. America is also in the midst of an ideological and racial civil war.

So who's in more trouble. China or America?
China is run by the CPP, and the U.S. by Wall Street.

From what I gathered, total (not national) debt of China is around $40 trillion, and of the U.S. around $70 trillion.

Unfunded liabilities in China is probably around $70 billion, and in the U.S. between $100-220 trillion.

China has been experiencing a GDP growth rate of around 6 to 14 pct per annum the past two decades, and the U.S. -2.5 to 4 pct.

Given trend lines and trades with BRICS and over forty emerging markets, it's possible that China's growth rate will slow down slowly, with an average of around 5 pct, as its economy starts to mature, while the U.S. might also decline slightly to an average of above 1 pct because of soaring debt.

That debt level is a serious problem. If more countries start moving away from using the dollar and start engaging in more bilateral trade with each other....
 

·
Pisticus Veritas
Very Prepared!!
Joined
·
34,859 Posts
China is run by the CPP, and the U.S. by Wall Street.

From what I gathered, total (not national) debt of China is around $40 trillion, and of the U.S. around $70 trillion.

Unfunded liabilities in China is probably around $70 billion, and in the U.S. between $100-220 trillion.

China has been experiencing a GDP growth rate of around 6 to 14 pct per annum the past two decades, and the U.S. -2.5 to 4 pct.

Given trend lines and trades with BRICS and over forty emerging markets, it's possible that China's growth rate will slow down slowly, with an average of around 5 pct, as its economy starts to mature, while the U.S. might also decline slightly to an average of above 1 pct because of soaring debt.

That debt level is a serious problem. If more countries start moving away from using the dollar and start engaging in more bilateral trade with each other....
I just watched a financial analyst this morning who reported that the entire global debt is just shy of $300 trillion dollars. That's insane and obscene. This is the debt of the entire globe. Who holds the Title of the World? Who collects the interest and pulls the strings?

The entire banking industry is based on smoke and mirrors. It's the all-powerful Wizard of Oz that, in reality, is a frail old man hiding behind a curtain. The banks announce that they will loan money to anyone with some collateral. A bunch of nations jump at the chance. So the banks loan invisible money that doesn't even exist. They pull it straight from the air. Then they charge interest on the invisible, non-existent money. The nations scramble to pay it back but then continue to borrow thus digging themselves into a deeper financial hole. And the cycle continues year after year after year.

Where did $300 trillion dollars come from in the first place? The air!! It's the most ingenious shell game or magician's trick of all time. But, like the draw of any good magician, folks keep coming back to watch and they get tricked every time. The banking industry must be the envy of Penn & Teller.
 

·
Registered
Joined
·
7,547 Posts
Discussion Starter · #20 ·
China is run by the CPP, and the U.S. by Wall Street.

From what I gathered, total (not national) debt of China is around $40 trillion, and of the U.S. around $70 trillion.

Unfunded liabilities in China is probably around $70 billion, and in the U.S. between $100-220 trillion.

China has been experiencing a GDP growth rate of around 6 to 14 pct per annum the past two decades, and the U.S. -2.5 to 4 pct.

Given trend lines and trades with BRICS and over forty emerging markets, it's possible that China's growth rate will slow down slowly, with an average of around 5 pct, as its economy starts to mature, while the U.S. might also decline slightly to an average of above 1 pct because of soaring debt.

That debt level is a serious problem. If more countries start moving away from using the dollar and start engaging in more bilateral trade with each other....
China must run at 11% plus GDP to experience growth. Since DJT came on the scene they have been running in the 5-6% you listed above. That isn't going to work for them. I do agree on your thesis that they need our trade $ to stay afloat. They have issues of providing basic staples like food and clean water. The Chinese populace will rebel at some not to distant time. They are very smart Folks who can no longer be hoodwinked as they've been for a good while.
 
1 - 20 of 42 Posts
Top