Obama is a whole lot like terminal cancer - it’s hard to care if you catch pneumonia too. China’s crony-communist economy isn’t likely to infect us with anything worse than what Obama has already done to our formerly prosperous country.
Where it can hurt us is if China dumps a large amount of their existing Treasury holdings and/or severely curtails future purchases.
Not many other countries are in a position to pick up the slack, even if they wanted to.
Result? Here comes QE4 here, and more global QE as well. Market reaction to further monetary easing is anyone’s guess.
And Janet can forget raising rates.
Give it six months to filter through.
This may repatriate some industry back to the US. Instability creates capital flight
I think that’s backwards. The sick US economy infected China and the world.
Yes, because China may need the money it has lent the U.S. We live off loans and they may come due sooner than our feckless spenders in D.C. thought.
I am an old guy.....I remember when electrical toasters came out in the stores....they were hi-tech...but after a few years, everyone had an electric toaster....and so the toaster company closed....a few years back, flat screen Tvs where the hi tech of the moment....now everyone has a flat screen TV, and so the TV company closes the doors....and China has nothing to sell....
Governments don't jump start business; They interfere and inhibit it. If you want a flourishing market, government must get out of the way and do nothing. Sadly, our own government, led by the severe Conservatives of the GOPe are no trying to tax and kill the internet based market.
China’s stock market is down by 8% today.
...
And it’s still up 70% compared to a year ago.
That would be scary given how slowly the global economy is currently growing and how little ammo governments have left to jump start business.
Just remove some of the stupider regulations in both the EU and the U.S.
Business would boom!
See, India's population is stabilizing, also, albeit much later (taking hold in the 1990s, as opposed to the 1970s.) But it's set to make a "soft landing" as opposed to a crash. In about 10-15 years, the final surge of China's baby boom will begin to retire. And with it, manufacturing capacity. China's export explosion will wind up meeting its own consumer demand, but profitability will be shot to hell.
So when do we bailout China?
The "official numbers" are what the central government says they should be.
They should build a few more ghost cities to stimulate their “fauxonomy”. They could use the older ghost cities for target practice for their developing military.
The administration will try to spin some story that it doesn’t affect us that much, and Wall Street will happily repeat that fiction to keep more dumb money in the market.