6 ms·

In what sense was the Evergrande situation caused by geopolitics? I was under the impression causes and effects were wholly domestic.

irjustin 3y ago
This post screams agenda. What is "warning shot"? They shot themselves in the foot with a property bubble to anger the US!!?? I'd move on.
- rnk 3y ago
  The US didn't have anything to do with evergrande afaik, and paying for property before it's built is a bad idea. But China can still try to deal with this by blaming the US for all ills and pushing for war with Taiwan to distract everyone - that works almost every time!
  - FooBarWidget 3y ago
    Okay so where is all the media blaming the economic issues on US? I sure haven't seen any on TV.
    - rnk 3y ago
      I don't know that it's happening now, I was making a suggestion that it could happen. If you're having economic troubles in a country, especially in an authoritarian country, blaming the outside world for your troubles can be a smart thing. No one can really argue with you in a dictatorship - if anyone is powerful enough to contest with you, you just kick them out of the ruling party, just like what actually happened in China with Xi removing Hu Jintao in a very public way at the party Congress. Another example is Russia threatening to invade the smaller countries around them if they make treaties with Western countries, and then invading them for being "bad" like in Ukraine, Georgia, Moldova, etc.
      - FooBarWidget 3y ago
        It "could" happen. On the other hand, it could also not happen. This is pure speculation on your part. Whatever happened to looking at evidence? This isn't the first time China has had economic trouble.
        rnk 3y ago
        The thing that makes it much more likely than could is it is the official goal of the communist party to unify with Taiwan, and they say they will do it by force if necessary. That makes it a matter of time, waiting for some weakness in Taiwan or the lack of will in the countries supporting them. If a much more powerful country says that they will take you over by force if you don't surrender, that's a pretty concerning position to be in.
        FooBarWidget 3y ago
        China's goal of unifying with Taiwan also existed the last few times they had economic troubles. Did they went to war with Taiwan do deflect economic trouble back then?
        rnk 3y ago
        They did not of course. China looks to be playing the long game to me. But China's economic issues are the most severe since they began their incredible time of growth and productivity increases. Best in the world ever as far as I know. But now they have terrible unemployment, so bad they stopped reported stats on that and some other areas, plus the shrinking population long term. I think up until now, for the last 30 years (?) they were on the upswing and they looked better and better. Now they are strong, but having serious economic challenges, more than past few years. The unneeded infrastructure will start to matter more. I really hope they can keep it together and not start a war. But it's such an incredible temptation for countries in this position. They are close to their maximum power, in 10 years I expect the worker shortage to really start to hurt.
        3y ago
starfallg 3y ago
The treatment of stakeholders have been different inside and outside of China. The assumption based on the experience so far is that inevitably overseas investors, such as US based entities, will lose out more. Chinese firms have been raising money in overseas markets and has been exporting risk in this way, the issue is how China's government will handle this against the opaque corporate structure behind these financial instruments sold overseas.
- ralph84 3y ago
  > inevitably overseas investors, such as US based entities, will lose out more As they should. US-based entities speculating in China thinking the CCP had their back falls squarely into play stupid games, win stupid prizes.
  - jldugger 3y ago
    Well, caveat emptor but you can't exactly dunk on capital inflows consequence free.
    - vkou 3y ago
      A truly developing nation can't, the economic powerhouse of the 21st century has a lot more latitude in this respect. As long as not every single investment in it goes tits up, there won't be any shortage of dumb FOMO money chasing growth. (Look at the mountains of money piled into straight-up obvious crypto scams, at least China is full of real companies that are doing real business[1], even if sometimes that business goes to shit.) [1] Like making all the things the world uses. And serving half a billion people living middle-class lifestyles.
      - starfallg 3y ago
        There's a lot of corporate scams in China that gets swept under the rug. That's not a validation of China's model of growth, it just postpones the pain, like Japan's lost decade. And Japan was a lot more developed when its real estate bubble popped. China has experienced the catch-up growth that it missed out on after 1949 in the past 3 decades or so. The trajectory of growth is less than for example, South Korea or Japan. The big difference being that China has more people.

irjustin 3y ago

This post screams agenda. What is "warning shot"? They shot themselves in the foot with a property bubble to anger the US!!?? I'd move on.

rnk 3y ago
The US didn't have anything to do with evergrande afaik, and paying for property before it's built is a bad idea. But China can still try to deal with this by blaming the US for all ills and pushing for war with Taiwan to distract everyone - that works almost every time!
- FooBarWidget 3y ago
  Okay so where is all the media blaming the economic issues on US? I sure haven't seen any on TV.
  - rnk 3y ago
    I don't know that it's happening now, I was making a suggestion that it could happen. If you're having economic troubles in a country, especially in an authoritarian country, blaming the outside world for your troubles can be a smart thing. No one can really argue with you in a dictatorship - if anyone is powerful enough to contest with you, you just kick them out of the ruling party, just like what actually happened in China with Xi removing Hu Jintao in a very public way at the party Congress. Another example is Russia threatening to invade the smaller countries around them if they make treaties with Western countries, and then invading them for being "bad" like in Ukraine, Georgia, Moldova, etc.
    - FooBarWidget 3y ago
      It "could" happen. On the other hand, it could also not happen. This is pure speculation on your part. Whatever happened to looking at evidence? This isn't the first time China has had economic trouble.
      - rnk 3y ago
        The thing that makes it much more likely than could is it is the official goal of the communist party to unify with Taiwan, and they say they will do it by force if necessary. That makes it a matter of time, waiting for some weakness in Taiwan or the lack of will in the countries supporting them. If a much more powerful country says that they will take you over by force if you don't surrender, that's a pretty concerning position to be in.
        FooBarWidget 3y ago
        China's goal of unifying with Taiwan also existed the last few times they had economic troubles. Did they went to war with Taiwan do deflect economic trouble back then?
        rnk 3y ago
        They did not of course. China looks to be playing the long game to me. But China's economic issues are the most severe since they began their incredible time of growth and productivity increases. Best in the world ever as far as I know. But now they have terrible unemployment, so bad they stopped reported stats on that and some other areas, plus the shrinking population long term. I think up until now, for the last 30 years (?) they were on the upswing and they looked better and better. Now they are strong, but having serious economic challenges, more than past few years. The unneeded infrastructure will start to matter more. I really hope they can keep it together and not start a war. But it's such an incredible temptation for countries in this position. They are close to their maximum power, in 10 years I expect the worker shortage to really start to hurt.
        3y ago

starfallg 3y ago

The treatment of stakeholders have been different inside and outside of China. The assumption based on the experience so far is that inevitably overseas investors, such as US based entities, will lose out more. Chinese firms have been raising money in overseas markets and has been exporting risk in this way, the issue is how China's government will handle this against the opaque corporate structure behind these financial instruments sold overseas.

ralph84 3y ago
> inevitably overseas investors, such as US based entities, will lose out more As they should. US-based entities speculating in China thinking the CCP had their back falls squarely into play stupid games, win stupid prizes.
- jldugger 3y ago
  Well, caveat emptor but you can't exactly dunk on capital inflows consequence free.
  - vkou 3y ago
    A truly developing nation can't, the economic powerhouse of the 21st century has a lot more latitude in this respect. As long as not every single investment in it goes tits up, there won't be any shortage of dumb FOMO money chasing growth. (Look at the mountains of money piled into straight-up obvious crypto scams, at least China is full of real companies that are doing real business[1], even if sometimes that business goes to shit.) [1] Like making all the things the world uses. And serving half a billion people living middle-class lifestyles.
    - starfallg 3y ago
      There's a lot of corporate scams in China that gets swept under the rug. That's not a validation of China's model of growth, it just postpones the pain, like Japan's lost decade. And Japan was a lot more developed when its real estate bubble popped. China has experienced the catch-up growth that it missed out on after 1949 in the past 3 decades or so. The trajectory of growth is less than for example, South Korea or Japan. The big difference being that China has more people.