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China's booming middle class is creating world's most dynamic consumer market
- 1971genocide 11y agoWhen I was young I remember the world used to be beholden to the demand of the american consumer. What they wanted drove the export of entire economical regions in Asia. Now it seems the giant in the room that everyone needs to accommodate is the Chinese consumer.
- hackuser 11y agoA good point. But consider also that in a free and open society with limited government, consumers have more influence. In China it might be the Chinese government that everyone needs to accomodate. Certainly that has been a focus of the movie industry.
- nickbauman 11y agoThe world has been beholden to US consumer demand since the end of the Bretton Woods system (which ended when Nixon unpegged the dollar from gold in 1973) up until the collapse of the US center of gravity in 2008 (from which we haven't really recovered). Prior to that it was the opposite: Demand came from the periphery, and the US was the world's factory. Where we are now is uncharted waters. US demand is required to fuel the Global Surplus Recycling Mechanism. With its absence, China does not have enough domestic demand to replace the US and does not have enough power to start its own GSRM.
- 1971genocide 11y agoIs that you ? Is it the former greek finance minister ?
- adventured 11y agoThe US consumer market today is three to four times larger than the Chinese consumer market. So no, the roles have not switched yet, not even close. The US economy growing at 2-2.5% is growing nearly as fast as China's economy today (given their non-fake rate of growth is more likely in the low single digits of around 3% to 4%).
- fspeech 11y agoAnd how much of the US consumer market is tradable goods?
- gcdgcd3 11y agoChina's middle class will die soon because Xijinping will launched the 2nd Cultural Revolution
- simple123 11y agoIt seems to me the article written by a Lobbyists of CCP before Xi's visit
- eva1984 11y agoOr it could be just telling the truth.
- tmgcd 11y agoTelling the truth? Until Aug,2015 about 276 lawyers who help Chinese people protecting their human right have been arrested. But China still claim it is a country under the rule of law. Another example is that recently an official media of China claim that China is the most democratic country in the world. CCP is evil, never trust it!!!!!
- gph 11y agoNothing you said contradicts anything written in the article. In fact it's basically a completely different topic. If someone wrote an article about the American economy it wouldn't be contradicted because you can denounce the American government or criminal justice system.
- superuser2 11y agoFrom where do you get the ridiculous claim that human rights and the rule of law are preconditions for economic prosperity? There are many unfree yet rich countries, i.e. Singapore.
- n00b101 11y agoWhat is the potential for enterprise software in China?
- shiftpgdn 11y agoHaving your software stolen after they request a 30 day trial.
- tsotha 11y agoThat's the Far East for ya. We gave a Korean company a 30-day evaluation copy of our software in the early '90s. They decided not to purchase, and a few years later we dropped the product entirely. In 1999 someone from the Korean company called up and asked if we could certify our software to be Y2K compliant.
- wingerlang 11y agoWas there no killswitch after the 30 days? Is that not common in these "company trials"?
- tsotha 11y agoOddly, no. We're not a software company, and we don't normally sell our software. It's developed for in-house use. One of the managers thought this particular application would be pretty lucrative if we sold it overseas (our customers are all in the US), so he got permission to do so. But we really didn't know what we were doing, i.e. we had a useful application with thousands of internal customers, but on the business side we were making it all up as we went along. In the end the product was dropped because there's a lot of effort that goes into making an application a product you can sell to other companies, and we would have had to grow our organization more than the higher-ups wanted to grow it. Things like fancier interfaces, license enforcement, documentation, packaging, 24 hour support, etc.
- sunwooz 11y agoYeah, let's generalize an entire region after getting screwed over by one company.
- metaphorical 11y agoIf its economy won't hit a hard-landing and the current reform is successful, then yes I think China will have a booming middle class by 2020. But does the emperor have clothes on? No one can really say for sure.
- nickbauman 11y agoI read in Yanis Verofakis last book that Chinese consumer demand has been falling off since 2012 or so. I can't find good data on this out there though.
- jeremonda 11y agoThe fact that China's booming middle class is creating world's most dynamics consumer market, is why we need ethics in creating dynamic consumer market.
- LiweiZ 11y agoDriven by paper money boom.
- sharetea 11y agoAnne Stevenson-Yang, a journalist and software executive who's worked and lived in China since 1985, and now a research director at an investment capital firm, has this to say about China's GDP: "actual Chinese GDP is probably a third lower than is officially reported" http://www.barrons.com/articles/anne-stevenson-yang-why-xi-jinpings-troubles-and-chinas-could-get-worse-1417846773 http://www.barrons.com/articles/anne-stevenson-yang-why-xi-j... "China is sinking into a deflationary recession that’s increasing in speed and may take some time to run its course. Investors have lost faith in the property market, which alone comprises about 20% of GDP, when taking into account the entire supply chain, from iron-ore production to construction to related financial services and appliance sales. Employment and wage compensation will suffer. Consumption will continue to suffer. There’s even an outside possibility that China’s economic miracle could end up in a fiery crash landing, if a surge in banking-system loan defaults outruns government regulators’ attempt to contain such a credit crisis and restore financial confidence." She has a good video about China's economy here: https://www.youtube.com/watch?v=C2SStFt-k_A https://www.youtube.com/watch?v=C2SStFt-k_A
- 6t6t6 11y agoMaybe the article represents a bit of wishful thinking; but the fact that this is the most up-voted comment is also quite revealing.
- sharetea 11y agoAnother number to watch out for is capital outflow out of China. "Over the last seven weeks alone, $190 billion has left the country." http://www.businessinsider.com/chinas-record-capital-outflows http://www.businessinsider.com/chinas-record-capital-outflow... "by 2018 all of China's excess reserves — cash that it has on hand to use immediately — could be gone."
- chvid 11y agoWhy the strong anti-China sentiment on HN? I don't get it.
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- paulsutter 11y agoEverybody wants to have a binary outcome for China: China, is it an all dominating inevitability? Or a massive fustercluck? A or B! And that's silly. China will grow tremendously over the next 30 years, and that growth will be filled with turmoil, booms and busts. Things are only black and white in comic books.
- sharetea 11y agoOr it could be like Japan and stagnate over the next 30 years, due to its similarity to Japan in demographics, exporting country's inability to transform to a consumer economy, massive internal debt, capital flight, etc.
- nickbauman 11y agoThis is why China won't upvalue their currency like Japan did in the 80's (at the insistence, once again, of the US essentially forcing Japan to sign the Plaza Accords to stop Japan from becoming a rentier nation). They've learned from Japan's crisis.
- paulsutter 11y agoChina and Japan are about as different and opposite as two places can be (I've spent time in Asia). Their both very unique places in completely opposite ways. The differences are countless and I struggle to find even minor similarities.
- dreamfactory2 11y agoI've spoken with Chinese business people who have echoed exactly that concern
- sharetea 11y agoI have lived in both. Cultural differences are not economic differences.
- pmontra 11y agoI was there on vacation one month ago and I have no trouble believing this article. The number of tourists paying European level entry fees to museums, parks and attractions is just too big (incredibly long lines everywhere, very few people from outside China). By comparison food is about 3 times as cheap as in western Europe and goods are as cheap as one expects from China. Still, and I know this is not the point of the article, they are too many to live well, no matter how rich they become. Life there is a sequence of long lines. Three weeks there have reset my baseline for many things. When I came back home (Milan, Italy) I was surprised by how silent and desert it is and by how much sky I could see. Hardly the feelings one usually has when getting here.
- gregpilling 11y agofor months after returning from China I marveled at the empty sidewalks in Arizona where I live. I understand totally what you are saying. China is a fascinating place.