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I feel the US must have a gun to China's head right now. This is such a stark reversal from what we believed was going on over the past few years. The fact that

by TACIXAT 11y ago

I feel the US must have a gun to China's head right now. This is such a stark reversal from what we believed was going on over the past few years. The fact that China would agree to stop attacking the US, much less arrest those involved is mind blowing. Previously, it appeared that the hacking groups worked very closely with the government. They would attack targets that would directly benefit state run organizations. For China to flip and arrest the people who they employed tells me the US has some serious leverage right now. Either that or these arrests are just a show and won't stick.

sharetea 11y ago
Money talks, and China's in serious trouble and it desperately needs to cooperate with US. That's why the Chinese president came to US to resolve issues with cyberhacking. - $141.66bn capital left China in August http://bit.ly/1jh7E7z http://bit.ly/1jh7E7z - "by 2018 all of China's excess reserves — cash that it has on hand to use immediately — could be gone." http://read.bi/1jkK6hv http://read.bi/1jkK6hv - "actual Chinese GDP is probably a third lower than is officially reported" http://bit.ly/1JsjaC0 http://bit.ly/1JsjaC0 - "The exodus of factories moving out of China in search of lower-cost options in southeast and central Asia is accelerating, as manufacturers face increased pressure to reduce unit costs." http://bit.ly/1hw8Zp3 http://bit.ly/1hw8Zp3 - "average new home prices in China’s 70 major cities dropped 6.1 per cent" http://bit.ly/1jh9eGp http://bit.ly/1jh9eGp - "Total debt has reached 282 percent of GDP" http://bloom.bg/1evYSQ5 http://bloom.bg/1evYSQ5
- toomuchtodo 11y ago
  Wow, those are absolutely terrible economic indicators. That's not just reduced GDP; those are recession numbers.
  - sharetea 11y ago
    If you think that's terrible, this would be frightening. http://www.thestar.com.my/Business/Business-News/2015/10/10/If-you-think-Chinas-equity-bubble-is-scary-check-out-bonds/?style=biz http://www.thestar.com.my/Business/Business-News/2015/10/10/... "While an imminent collapse isn’t yet the base-case scenario for most forecasters, China’s 42.2 trillion yuan (US$6.7 trillion) bond market is flashing the same danger signs that triggered a tumble in stocks four months ago: stretched valuations, a surge in investor leverage and shrinking corporate profits. A reversal would add to challenges facing China’s ruling Communist Party, which has struggled to contain volatility in financial markets amid the deepest economic slowdown since 1990."
    - toomuchtodo 11y ago
      I am now sufficiently frightened into making changes to my personal financial strategy based on this (no longer contributing additional funds to non-retirement investment accounts, instead directing those funds to paying off debt at a faster rate). Shit appears to be getting real shortly.
- huac 11y ago
  That the Chinese government likely over-estimates GDP is widely known (some indicators are reported magnitudes faster than any other country). The increased debt and factory exodus are probably uniformly bad. On the other hand, a decrease in cash reserves is almost certainly in China's favor. The government has been struggling for years to get rid of its enormous US currency holdings. Especially as we start to see the yuan strengthening and the Fed raise interest rates, it's important for China to extract as much value out of the USD as soon as possible.
  - sharetea 11y ago
    1.) Dollar is strengthening. Janet Yellen said she'll raise rates by the end of the year. Most emerging market currencies have crashed 25-40% this year. 2.) Yuan is weakening. Otherwise Chinese corporate dollar-denominated debts, which is around 1 trillion, will crush the economy right away when the fed raises rates. Plus the government already signaled it is willing to guide yuan lower a month ago. 3.) That's kinda like saying 'well, my 3 houses in the hamptons are burning down, but at least wood structure is the strongest right now!'
    - huac 11y ago
      Hmm. Haven't followed the econ beat in the last couple months, my bad. I don't follow your 3rd point though. What do you mean?
jusben1369 11y ago
It might also indicate that China is feeling more confident that it has closed the gap and no longer needs to use illegal channels. In addition they'll soon find the shoe on the other foot and thus it's a good time to take a pro IP protection stance. It's also fair that right now the US economy is much stronger than China's and so sanctions would not look good at home.
mtgx 11y ago
It's possible China is doing this to improve commercial relationship with the U.S., especially if the US allows it to bully American companies into doing "joint ventures" with Chinese companies, if they want to do business there: http://www.reuters.com/article/2015/09/24/cisco-systems-china-idUSL1N11U06K20150924 http://www.reuters.com/article/2015/09/24/cisco-systems-chin... I don't think US is holding a gun to China's head. I think it's more of a quid pro quo thing. It may even be worse than that. China and US may have agreed to arrest some people for show, so it looks like the US gov is "doing something", while in reality nothing major changes, and the two countries agree to spy each other for economic purposes. If we're going to continue to see these arrests of hackers who hacked into the US from China over the next year, then maybe we're going somewhere. But if this is it as the response for the OPM hack, then it was definitely just for show.
- deleted 11y ago
  [deleted]
dantillberg 11y ago
But on the other hand, the Chinese government could, for example, choose to only succeed in arresting and prosecuting hackers that are not affiliated with the government itself, making the trials visible internationally as desired, and using the information provided about government-sponsored, or government-approved, hacking to improve their methods and to help avoid detection in the future. International cooperation is great, and we should all hope for peace and prosperity, but there are certainly proponents in both Washington and Beijing that see all these things through a lens of competition, protectionism, and also the possibility of war. It's hard to tell how strong those proponents' influence is on either side of the Pacific.
fspeech 11y ago
"The arrests were apparently separate from a mass sweep launched by the Chinese government in July in which authorities as of early September had arrested about 15,000 people for alleged cybercrimes, which included hacking, sending spam text messages and online scams." What is a few more hackers if they already arrested 15000? It probably ties much more into other legal cooperative matters such as US willingness to send back people the Chinese government wants to face corruption charges in China.

by TACIXAT 11y ago

sharetea 11y ago

Money talks, and China's in serious trouble and it desperately needs to cooperate with US. That's why the Chinese president came to US to resolve issues with cyberhacking. - $141.66bn capital left China in August http://bit.ly/1jh7E7z http://bit.ly/1jh7E7z - "by 2018 all of China's excess reserves — cash that it has on hand to use immediately — could be gone." http://read.bi/1jkK6hv http://read.bi/1jkK6hv - "actual Chinese GDP is probably a third lower than is officially reported" http://bit.ly/1JsjaC0 http://bit.ly/1JsjaC0 - "The exodus of factories moving out of China in search of lower-cost options in southeast and central Asia is accelerating, as manufacturers face increased pressure to reduce unit costs." http://bit.ly/1hw8Zp3 http://bit.ly/1hw8Zp3 - "average new home prices in China’s 70 major cities dropped 6.1 per cent" http://bit.ly/1jh9eGp http://bit.ly/1jh9eGp - "Total debt has reached 282 percent of GDP" http://bloom.bg/1evYSQ5 http://bloom.bg/1evYSQ5

toomuchtodo 11y ago
Wow, those are absolutely terrible economic indicators. That's not just reduced GDP; those are recession numbers.
- sharetea 11y ago
  If you think that's terrible, this would be frightening. http://www.thestar.com.my/Business/Business-News/2015/10/10/If-you-think-Chinas-equity-bubble-is-scary-check-out-bonds/?style=biz http://www.thestar.com.my/Business/Business-News/2015/10/10/... "While an imminent collapse isn’t yet the base-case scenario for most forecasters, China’s 42.2 trillion yuan (US$6.7 trillion) bond market is flashing the same danger signs that triggered a tumble in stocks four months ago: stretched valuations, a surge in investor leverage and shrinking corporate profits. A reversal would add to challenges facing China’s ruling Communist Party, which has struggled to contain volatility in financial markets amid the deepest economic slowdown since 1990."
  - toomuchtodo 11y ago
    I am now sufficiently frightened into making changes to my personal financial strategy based on this (no longer contributing additional funds to non-retirement investment accounts, instead directing those funds to paying off debt at a faster rate). Shit appears to be getting real shortly.
huac 11y ago
That the Chinese government likely over-estimates GDP is widely known (some indicators are reported magnitudes faster than any other country). The increased debt and factory exodus are probably uniformly bad. On the other hand, a decrease in cash reserves is almost certainly in China's favor. The government has been struggling for years to get rid of its enormous US currency holdings. Especially as we start to see the yuan strengthening and the Fed raise interest rates, it's important for China to extract as much value out of the USD as soon as possible.
- sharetea 11y ago
  1.) Dollar is strengthening. Janet Yellen said she'll raise rates by the end of the year. Most emerging market currencies have crashed 25-40% this year. 2.) Yuan is weakening. Otherwise Chinese corporate dollar-denominated debts, which is around 1 trillion, will crush the economy right away when the fed raises rates. Plus the government already signaled it is willing to guide yuan lower a month ago. 3.) That's kinda like saying 'well, my 3 houses in the hamptons are burning down, but at least wood structure is the strongest right now!'
  - huac 11y ago
    Hmm. Haven't followed the econ beat in the last couple months, my bad. I don't follow your 3rd point though. What do you mean?

jusben1369 11y ago

It might also indicate that China is feeling more confident that it has closed the gap and no longer needs to use illegal channels. In addition they'll soon find the shoe on the other foot and thus it's a good time to take a pro IP protection stance. It's also fair that right now the US economy is much stronger than China's and so sanctions would not look good at home.

mtgx 11y ago

It's possible China is doing this to improve commercial relationship with the U.S., especially if the US allows it to bully American companies into doing "joint ventures" with Chinese companies, if they want to do business there: http://www.reuters.com/article/2015/09/24/cisco-systems-china-idUSL1N11U06K20150924 http://www.reuters.com/article/2015/09/24/cisco-systems-chin... I don't think US is holding a gun to China's head. I think it's more of a quid pro quo thing. It may even be worse than that. China and US may have agreed to arrest some people for show, so it looks like the US gov is "doing something", while in reality nothing major changes, and the two countries agree to spy each other for economic purposes. If we're going to continue to see these arrests of hackers who hacked into the US from China over the next year, then maybe we're going somewhere. But if this is it as the response for the OPM hack, then it was definitely just for show.

deleted 11y ago
[deleted]

dantillberg 11y ago

But on the other hand, the Chinese government could, for example, choose to only succeed in arresting and prosecuting hackers that are not affiliated with the government itself, making the trials visible internationally as desired, and using the information provided about government-sponsored, or government-approved, hacking to improve their methods and to help avoid detection in the future. International cooperation is great, and we should all hope for peace and prosperity, but there are certainly proponents in both Washington and Beijing that see all these things through a lens of competition, protectionism, and also the possibility of war. It's hard to tell how strong those proponents' influence is on either side of the Pacific.

fspeech 11y ago

"The arrests were apparently separate from a mass sweep launched by the Chinese government in July in which authorities as of early September had arrested about 15,000 people for alleged cybercrimes, which included hacking, sending spam text messages and online scams." What is a few more hackers if they already arrested 15000? It probably ties much more into other legal cooperative matters such as US willingness to send back people the Chinese government wants to face corruption charges in China.