Is China Going Broke and Taking the World With It?

Discussion in 'Property Market Economics' started by Phineas, 30th Oct, 2019.

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  1. Phineas

    Phineas Well-Known Member

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    I found this short interview very insightful...

    Is anyone restructuring portfolios based on the seemingly constant alarm over China, or is it all just scaremongering?

     
    Phineas, 30th Oct, 2019
    #1
  2. Peter2013

    Peter2013 Well-Known Member

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    Ecomomics 101 says if you borrow money, you bring forward demand. You spend money today, which you would otherwise spend in the future. Having spent the money today, there is no money to spend in the future.

    China households have a lot of debt. They have brought a lot of spending forward. Now they have to pay it back - i.e stop borrowing and deleverage.

    The slow down will be proportional to the amount of debt they have. And they have a lot of debt.
     
    Last edited: 31st Oct, 2019
    Peter2013, 31st Oct, 2019
    #2
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  3. Dean Collins

    Dean Collins Well-Known Member

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    I wouldnt stress too much about it. Im more worried about how much debt Australians have......every time the RBA tries to help them by cutting mortgage rates.......they go out and borrow even more money putting themselves into even more debt !!
     
    Dean Collins, 1st Nov, 2019
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  4. Peter2013

    Peter2013 Well-Known Member

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    Yes, and economics 101 applies also to Australia.

    Australia households have debt equal to almost 200% of household disposable income, the 2nd highest level in the world.

    We have brought a significant amount of spending forward as well which has created a "miracle" 28 years of continuous economic expansion - Miracle because its made up of debt and not good economic management.

    When the debt runs out.....
     
    Peter2013, 1st Nov, 2019
    #4
  5. Phar Lap

    Phar Lap Well-Known Member

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    the Rothschilds of the world profit.
     
    Phar Lap, 1st Nov, 2019
    #5
  6. Dean Collins

    Dean Collins Well-Known Member

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    There is a reason Buffett is sitting on $128B in cash.

    the old ******* cant help himself and he knows that there is a 2008 Part 2.0 coming sooner than later.

    Personally i think its going to be 2023, but a lot of people here in the USA think its going to be Elizabeth Warren induced leading up to Novembers election.
     
    Dean Collins, 5th Nov, 2019
    #6
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  7. JohnPropChat

    JohnPropChat Well-Known Member

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    JohnPropChat, 5th Nov, 2019
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  8. Sackie

    Sackie Well-known cafe bum of the East Premium Member

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    China is far from broke. They are kicking ass just fine imo.
     
    Sackie, 5th Nov, 2019
    #8
  9. mickyyyy

    mickyyyy Well-Known Member

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    Mr Buffet has been stacking for a while now
     
    mickyyyy, 5th Nov, 2019
    #9
  10. sumterrence

    sumterrence Well-Known Member

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    Well China can always print more money?
     
    sumterrence, 5th Nov, 2019
    #10