China’s Great Wall Of Debt

[TaiShang]

A gentle answer turns away wrath, But a harsh word stirs up anger. The tongue of the wise makes knowledge acceptable, But the mouth of fools spouts folly.…

Be the wise, my friend.

Indeed. Better to concentrate on what is constructive.

The best is on China's roads. And more and more of them

Mazda's sale in China jumps 62.4% in Feb

Mar 5, 2015 – Mazda Motor Corp, a Japanese automaker, has said that its auto sale in China surged 62.4% from a year earlier to 15,991 units in Feb 2015.

FAW Mazda Motor Sales Co Ltd, a joint venture between FAW Group and Mazda Motor Co, sold 5,337 vehicles in Feb, reflecting a year on year increase of 2.2%.


Meanwhile Changan Mazda, established by Chongqing Changan Automobile Co Ltd<000625><200625> and Mazda Motor, saw its sale in China skyrocketed 130.2% year on year to 10,654 units in the period.


In the first two months of 2015, the Japanese automaker sold 40,529 vehicles in China, reflecting a year on year increase of 7.7%, including 26,552 units from Changan Mazda, surged 74.7% year on year.

***

But China's own is not doing too bad, as well:

Geely Auto's sales up 76% in Jan to over 58k units

Feb 6, 2015 – Geely Automobile Holdings Ltd<0175>, the listed unit of China's largest privately-owned carmaker Zhejiang Geely Holding, has said that its auto sales increased 76% year on year to 58,884 units in Jan 2015.

 

[Aepsilons]

The best is on China's roads. And more and more of them

Mazda's sale in China jumps 62.4% in Feb

Mar 5, 2015 – Mazda Motor Corp, a Japanese automaker, has said that its auto sale in China surged 62.4% from a year earlier to 15,991 units in Feb 2015.

FAW Mazda Motor Sales Co Ltd, a joint venture between FAW Group and Mazda Motor Co, sold 5,337 vehicles in Feb, reflecting a year on year increase of 2.2%.


Meanwhile Changan Mazda, established by Chongqing Changan Automobile Co Ltd<000625><200625> and Mazda Motor, saw its sale in China skyrocketed 130.2% year on year to 10,654 units in the period.


In the first two months of 2015, the Japanese automaker sold 40,529 vehicles in China, reflecting a year on year increase of 7.7%, including 26,552 units from Changan Mazda, surged 74.7% year on year.

You sure do know how to make a man smile, my friend. lol.

Cheers!

@Nihonjin1051

True, but meekness and gentleness certainly didn't turn the Huns, or Mongols, or Vietnamese, or indeed Hideyoshi away from East Asia. A benign display of force saves lives. If the Ming better conveyed their strength and will to defend Korea that disaster would never have happened.

It takes two to tango, my friend. These wars were due to the aggressive policies of foreign peoples , and also it was the corruption and excessive lavish rule of the Emperors that had caused the lapse in defense.

I'm sure you've read the writings of Master Mencious. Mengzi describes benevolence and righteousness as the two most important principles of moral conduct. Benevolence (ren) is the heart (xin) or internal source of moral conduct, while righteousness (yi) is the proper path for moral conduct. A righteous ruler knows the balance of benevolence, righteousness and stern discipline of his subjects.

 

[IsaacNewton]

I don't get why you call Turkey a third world country. We don't have any problems like malnourishment. Something that is a issue for Chinese. Majority of Chinese live in poverty and can't even afford 2000 calories. You act like every Chinese is living in Hong Kong.

You are being delusional.

Have you been to China before? While they are not as rich as the west, the majority of Chinese are not in poverty, in fact, very few percentage of Chinese are suffering from malnutrition.

Also, Turkey is not a European country, it is Middle Eastern, there is a reason why Turkey has been begging EU for membership for over 60 years but never granted one.

In terms of development, China is actually ahead of Turkey in some key parameters. Cities of Shanghai, Guangzhou are vastly superior in infrastructure to anything in Turkey. Education centers in China are much better than Turkey's. In Science, technology, Pisa scores, ect, China out performs Turkey.

Turkey's growth rate was 2.1% in 2014 (compared to 7.4% from China), and has a collapsing currency (from 2 Lira-1Dollar to 2.5 Lira-1 Dollar). Compounded with the fact that Turkey is in one of the most unstable geographical locations in the world with constant threat from ISIS, Kurd independence, ect, while China is in the politically stable East Asia, I won't be surprise at all if within 5 years, China has a higher GDP per capita than Turkey.

 

[LeveragedBuyout]

Well, Japan also is in that same precarious situation. Our debt is also immense, fortunately the debt is locally owned. If China's debt is locally owned then they have insulation capacity. Perhaps we can get the expert opinion of Sir @LeveragedBuyout --- i resign to his candid analysis in these matters.

On a mobile, so no links or fancy charts this time. You and Viet are correct, in that China (and Japan) have the vast majority of their debt denominated in their own currencies, which means that the government has total control over the ability to repay or monetize debt. As Viet also points out, debt is not bad in itself, it is only bad if the return from the investment financed by the debt does not enable debt repayment.

That said, there are limits. The US also has its debt denominated in USD, but the ability to manage the debt doesn't mean it will not have severe consequences (see: the financial crisis). The least damaging way to manage the debt is for the central government to leverage itself (I.e. spend and increase debt/GDP) while corporations and households deleverage (what Ray Dalio calls "a beautiful deleveraging").

China has a low debt/GDP ratio, so this is possible. The problem is that the government spending will almost certainly be malinvestment (in other words, wasteful spending with low or no returns), since much has already been done to build out China's infrastructure and housing, and the corporate sector has already created too much factory capacity and oversupply. What then? That's the worry. That's what happened to Japan, and it resulted in several "lost decades" of growth.

There is no question that China can and will survive the debt build-up. But the credit super-cycle is coming to an end, and so is China's era of high growth. Will China glide into a soft landing and normal growth, or will it experience a 2008-style crisis with a slow, grinding recovery afterwards? Time will tell.

 

[Keel]

@TaiShang @Keel @ChineseTiger1986

I think I just heard a loud pop coming from the direction of Anatolia ... I think our friend may have finally pulled the detonator

Just ignore notorious China-bashers like @atatwolf
I am not sure if he is ethnic Indian or Turkish

Regarding the debt situaion of China, these people commenting on the subject dont know what a balance sheet is let alone having the chance to read it

The us dollar is strengthening. Lets start doing more on our "quantitative easing" as every one is doing it now

There are a whole basket of methods when China can use to ease down the pressure more than those ignoramus can imagine PERIOD

Qing dynasty - King Qianlong porcelain jar with cover made in Jingdezhen using relief engraving technique
乾隆盖罐斗彩云龙纹盖罐

 

[TheTruth]

@Keel strong theory on Indian origins of Atatwolf, makes a great deal of sense.

 

[TaiShang]

Just ignore notorious China-bashers like @atatwolf
I am not sure if he is ethnic Indian or Turkish

Regarding the debt situaion of China, these people commenting on the subject dont know what a balance sheet is let alone having the chance to read it

The us dollar is strengthening. Lets start doing more on our "quantitative easing" as every one is doing it now

There are a whole of of methods when China can ease down the pressure more than those ignoramus can imagine PERIOD

Qing dynasty - King Qianlong porcelain jar with cover made in Jingdezhen using relief engraving technique
乾隆盖罐斗彩云龙纹盖罐

He is definitely a Turk. You can see him post in Turkish. But I agree on ignoring the individual. In fact, I have stopped engaging him for a long time although he is not on my ignore list.

On topic:

China's dept is manageable. Debt to GDP ratio has been constantly dropping for 3 years after a spike during the Financial Crisis of 2008.

Chinese investment in infrastructure creates positive externalities which may not be directly quantified. But, without a decent infrastructure and transportation, how would you anticipate a sustainable and good quality growth. No economic miracles are born from slums and the money spend on good housing, transportation and logistics are long term investments that increase people's quality of life, productivity and creativity.

Besides, China's public projects such as HSR has already turned profitable -- this is amazing given the fact that even in Taiwan the HSR is losing money.

So much money has been spend on HSR. But, think about the positive returns in the form of increased connectivity, faster life style, growing internal tourism, as well as a knowledge base. China's HSR has 1900 patents and 450 more are pending. That's a knowledge pool that will enable China to achieve good quality growth.

China's debt created by public infrastructure, transportation and housing is justified and the return (quantifiable and non-quantifiable) is already here to be seen.

Last note: The debt is in RMB. Hence, it can be paid by simply printing more RMB. A lower RMB is a boost for export.

@Keel strong theory on Indian origins of Atatwolf, makes a great deal of sense.

No, my friend. He is not an Indian. He has been posting stuff in Turkish on their particular section.

 

[Keel]

He is definitely a Turk. You can see him post in Turkish. But I agree on ignoring the individual. In fact, I have stopped engaging him for a long time although he is not on my ignore list.

On topic:

China's dept is manageable. Debt to GDP ratio has been constantly dropping for 3 years after a spike during the Financial Crisis of 2008.

Chinese investment in infrastructure creates positive externalities which may not be directly quantified. But, without a decent infrastructure and transportation, how would you anticipate a sustainable and good quality growth. No economic miracles are born from slums and the money spend on good housing, transportation and logistics are long term investments that increase people's quality of life, productivity and creativity.

Besides, China's public projects such as HSR has already turned profitable -- this is amazing given the fact that even in Taiwan the HSR is losing money.

So much money has been spend on HSR. But, think about the positive returns in the form of increased connectivity, faster life style, growing internal tourism, as well as a knowledge base. China's HSR has 1900 patents and 450 more are pending. That's a knowledge pool that will enable China to achieve good quality growth.

China's debt created by public infrastructure, transportation and housing is justified and the return (quantifiable and non-quantifiable) is already here to be seen.

Last note: The debt is in RMB. Hence, it can be paid by simply printing more RMB. A lower RMB is a boost for export.

No, my friend. He is not an Indian. He has been posting stuff in Turkish on their particular section.

Doubtful
He could be ethnic Indian, retired may be, a grandpa who appeared to have "Indian" first names for his grand kids

On topic:

Again as I said there are a lot more methods we can deploy in tackling the debt issues than other countries which are already mired in deep debt crisis

The key hightlights for maintaining a stable economy, law and order in China are exports which are still forcasting a growth rate of 6.9%; maintaining a low unemployment rate and controlling inflation which is fairly low at the moment. As far as infrastructure investments are concerned we have already earmarked many gigangtic projects in the pipeline, it is time to slow down a bit for improving liquidity in our system

Overglazed Jingtailan 景泰蓝 porcelain vase

 

[Jlaw]

Local gov't debt risk "controllable": minister
(Xinhua) 13:46, March 06, 2015


BEIJING, March 6

The risk of China's local government debt is generally controllable,Finance Minister Lou Jiwei said Friday.

Lou made the remarks at a press conference on the sidelines of the annual session of the National People's Congress, the top legislature.

"China's local government debt problem is a fact," Lou said, "the government is guarding against regional financial risks."

"On the whole," he said, "the risk of China's local government debt is controllable."

The local government debt piled up in past years should be resolved step by step, he said.

A slowing Chinese property sector has fueled worries that it may undercut local governments' fiscal revenue and blow up risks over local government debt.

"We have paid close attention to those localities that have a large amount of governmentdebt," said Lou, adding that his ministry is examining and verifying the latest figures of local government debt nationwide.

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Editor:Kong Defang,Yao Chun)

Handcrafted red clay teapot - 闵璐 Master Min Lu

Debt is nothing
Japan debt is 250% of GDP and that is mainstream figures. Who cares what bloggers and China haters think.

 

[Keel]

We are getting ourselves off the hook through many ways
This is one of them
https://defence.pk/threads/china-fe...its-record-370-5-bn-yuan（-60-billion）.363263/

Quartz inside painted snuff bottle with stopper

 

[opruh]

Turkey is not a third world country.

Economy of Turkey - Wikipedia, the free encyclopedia

With people like atawolf, they are on their way to being the newest addition to third world countries.

Are you seriously comparing European economies to the bubble gum paper tiger export economy of China? Most of the people can't even afford what you are producing and the production is soon moving out of China. Good luck munk!

What? Turkey is in Europe, stop dreaming, you guys are Asian.
What a bunch of European-wannabes.

Anyway, I believe the American economy is the one that has the bigger problem when it comes to debt.

Compared to mainland China, it is more developed in various parameters. Turkey is a developing country, and doing very well for the region she is in. So, please, be more objective in analysis than being rapacious.

TheTruth is Taiwanese, he is comparing Turkey with Taiwan, not Turkey with China.
And besides China is a developing country, and doing very well for the region she is in, more like dominating the region she is in.

 

[My-Analogous]

China’s Great Wall Of Debt
China’s debt has surged in recent years. Can it handle it?

By Anthony Fensom
March 04, 2015

China’s great leap forward economically has now led the communist nation to join its developed rivals in the major debtors club. With growth slowing, is the world’s second-biggest economy heading for a crash?

According to a new report by the McKinsey Global Institute (MGI), China’s debt has quadrupled from $7 trillion in 2007 to $28 trillion as of mid-2014, reaching 282 percent of gross domestic product (GDP) and higher than the level of the United States. Continuing its current pace of growth would see China’s debt reach 400 percent of GDP by 2018, the equivalent of Spain.

Commenting on China’s debt explosion, the report said: “Several factors are worrisome: half of loans are linked directly or indirectly to China’s real estate market, unregulated shadow banking accounts for nearly half of new lending, and the debt of many local governments is likely unsustainable.”
China’s Great Wall Of Debt | The Diplomat

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I know the US is a big debtor, but I am quite surprised to know China is in the same club...

How can it be? China is given surplus budget since 15 years, so how can they have these debt? please elaborate

Compared to Taiwan, it's a poor dirty shithole. Also a financial and technological midget.

Post reported

 

[Sanchez]

I think that this thread is a typical troll gethering one of China haters. These trolls would bring up something that makes China looking bad and start cheering of would-be China's downfall. None of these trolls actually understands what the article or the economic data says...It's a pity to see that the gang of trolls are most Viets, many Indians, one Pinoy and one turk. It seemed to me that they are here only to troll....

 

[Battle of Bach Dang River]

LOL I am not the author of the report, that is the McKinsey Global Institute (MGI)
As I said above, perhaps that includes government debt, local government debt, corporate debt.....
I think It is not problem if the economy will not continue slow down....

 

[senheiser]

die welt, one of the most creditable german newspapers today brings a report about chinese debts: from $2.1 trillions in 2000 to $28.2b trillions in 2014. but I think like the US, it should not be a problem as you can print the money to pay the debts.
Schuldenberg bringt Chinas Wirtschaft in Bedrängnis - DIE WELT

View attachment 200401

Die Welt are bunch of Pro US propaganda, not in one study china has so much debt. Neither Government or foreign debt, i dont know where they got the number of 28 trillion.

List of countries by external debt - Wikipedia, the free encyclopedia
List of countries by public debt - Wikipedia, the free encyclopedia