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" it is unlikely that China can rebalance from massive overproduction without massive layoffs." Why is that? it is a genuine question. Do they have an inflatio
by RobertoG 11y ago
" it is unlikely that China can rebalance from massive overproduction without massive layoffs."
Why is that? it is a genuine question. Do they have an inflation problem?
- rm_-rf_slash 11y agoProblems greater than inflation. Overproduction incentivizes dumping, which results in backlash from trading partners. It is also used to finance regional and local governments, which incentivizes overproduction and waste of resources. Sure, the thousands of construction workers making ghost cities get paid, but someone has to pay them. Not to mention the rampant corruption that occurs like magic when you mix money and power with a dash of unaccountability. http://www.economist.com/news/business/21693573-chinas-excess-industrial-capacity-harms-its-economy-and-riles-its-trading-partners-march http://www.economist.com/news/business/21693573-chinas-exces...