China nearly (Bankrupt) says Chinese Economist (But What's the Catch)..?
Chinese TV Host Says Regime Nearly Bankrupt..!
Updated: November 15, 2011
Larry Lang, chair professor of Finance at the Chinese University of Hong Kong.
China’s economy has a reputation for being strong and prosperous, but according to a well-known Chinese television personality the country’s Gross Domestic Product is going in reverse.
Larry Lang, chair professor of Finance at the Chinese University of Hong Kong, said in a lecture that he didn’t think was being recorded that the Chinese regime is in a serious economic crisis—on the brink of bankruptcy. In his memorable formulation: every province in China is Greece.
The restrictions Lang placed on the Oct. 22 speech in Shenyang City, in northern China’s Liaoning Province, included no audio or video recording, and no media. He can be heard saying that people should not post his speech online, or “everyone will look bad,” in the audio that is now on Youtube.
In the unusual, closed-door lecture, Lang gave a frank analysis of the Chinese economy and the censorship that is placed on intellectuals and public figures. “What I’m about to say is all true. But under this system, we are not allowed to speak the truth,” he said.
Despite Lang’s polished appearance on his high-profile TV shows, he said: “Don’t think that we are living in a peaceful time now. Actually the media cannot report anything at all. Those of us who do TV shows are so miserable and frustrated, because we cannot do any programs. As long as something is related to the government, we cannot report about it.”
He said that the regime doesn’t listen to experts, and that Party officials are insufferably arrogant. “If you don’t agree with him, he thinks you are against him,” he said.
Lang’s assessment that the regime is bankrupt was based on five conjectures.
Firstly, that the regime’s debt sits at about 36 trillion yuan (US$5.68 trillion). This calculation is arrived at by adding up Chinese local government debt (between 16 trillion and 19.5 trillion yuan, or US$2.5 trillion and US$3 trillion), and the debt owed by state-owned enterprises (another 16 trillion, he said). But with interest of two trillion per year, he thinks things will unravel quickly.
Secondly, that the regime’s officially published inflation rate of 6.2 percent is fabricated. The real inflation rate is 16 percent, according to Lang.
Thirdly, that there is serious excess capacity in the economy, and that private consumption is only 30 percent of economic activity. Lang said that beginning this July, the Purchasing Managers Index, a measure of the manufacturing industry, plunged to a new low of 50.7. This is an indication, in his view, that China’s economy is in recession.
Fourthly, that the regime’s officially published GDP of 9 percent is also fabricated. According to Lang’s data, China’s GDP has decreased 10 percent. He said that the bloated figures come from the dramatic increase in infrastructure construction, including real estate development, railways, and highways each year (accounting for up to 70 percent of GDP in 2010).
Fifthly, that taxes are too high. Last year, the taxes on Chinese businesses (including direct and indirect taxes) were at 70 percent of earnings. The individual tax rate sits at 81.6 percent, Lang said.
Once the “economic tsunami” starts, the regime will lose credibility and China will become the poorest country in the world, Lang said.
Several commentators have expressed broad agreement with Lang’s analysis.
Professor Frank Xie at the University of South Carolina, Aiken, said that the idea of China going bankrupt isn’t far fetched. Major construction projects have helped inflate the GDP, he says. “On the surface, it is a big number, but inflation is even higher. So in reality, China’s economy is in recession.”
Further, Xie said that official figures shouldn’t be relied on. The regime’s vice premier, Li Keqiang for example, admitted to a U.S. diplomat that he doesn’t believe the statistics produced by lower-level officials, and when he was the governor of Liaoning Province “had to personally see the hard data.”
Cheng Xiaonong, an economist and former aide to ousted Party leader Zhao Ziyang, said that high praise of the “China model” is often made on the basis of the high-visibility construction projects, a big GDP, and much money in foreign reserves. “They pay little attention to things such as whether people’s basic rights are guaranteed, or their living standard has improved or not,” he said.
Behind the fiat control of the economy, which can have the appearance of being efficient, there is enormous waste and corruption, Cheng said. It means that little spending is done on education, welfare, the health system, etc.
Cheng says that for the last decade the Chinese regime has accumulated its wealth primarily by promoting real estate development, buying urban and suburban residential properties at low prices (or simply taking them), and selling them to developers at high prices.
According to Cheng, the goals of regime officials (to enrich themselves and increase their power) are in direct conflict with those of the people–so social injustice expands, and economic propaganda meant to portray the situation as otherwise prevails.
Few scholars inside the country dare to speak as Lang has, Cheng said. And that’s probably because he has a professorship in Hong Kong.
http://www.theepochtimes.com/n2/chin...pt-141214.html
...then this from the IMF
IMF sounds warning for Chinese banking system
China's banks face 'steady build-up of financial sector vulnerabilities', according to IMF report
guardian.co.uk, Tuesday 15 November 2011
An IMF report has flagged up concerns over the possible vulnerability of the Chinese banking system. Photograph: Adrian Bradshaw/EPA
A rise in off-balance sheet liabilities and a house-price boom have left Chinese banks vulnerable to heavy losses, the International Monetary Fund (IMF) has said.
In a wide-ranging report into the Chinese financial system, the IMF said that China is facing a "steady build-up of financial sector vulnerabilities".
"The system is becoming more complex and inter-linkages between markets, institutions, and across international borders are growing. In addition, informal credit markets, conglomerate structures, and off-balance sheet activities are on the rise," it warned on Tuesday.
The government's role in allocating credit, as well as broader economic policy, is leading to a build-up in contingent liabilities, the IMF added, although it said it was difficult to quantify the risks given the paucity of data.
Stress tests on the country's 17 largest banks showed they were resilient to one-off shocks: "If several of these risks were to occur at the same time, however, the banking system could be severely impacted," the IMF has said
The review is the first time the IMF has reviewed the Chinese banking system.
It recommends that the Chinese government intervenes less to keep down the value of the yuan, uses interest rates rather than administrative limits to control credit demand, and allow banks to make commercial decisions on lending.
"Banks' large exposures to state-owned enterprises, guaranteed margins provided by interest rate regulations, still limited ability and willingness to differentiate loan rates, coupled with the implicit guidance on the pace and direction of new lending, undermine development of effective credit risk management in the banks. It is important that banks have the tools and incentives to make lending decisions based upon purely commercial goals."
In response to the report, the People's Bank of China (PBC), the country's central bank, said: "While the assessment in the reports is, overall, objective and positive, and the recommendations on the future reforms are constructive, a few points are not sufficiently well-rounded or objective, and the timeframe and suggested priorities of some proposed reform measures need to be further analysed."
In particular, the PBC said China had already moved away from administrative quotas on credit and towards an interest-rate based monetary policy.
China's breakneck growth has created huge opportunities for investment. But many warn of the significant risks attached, too. Veteran UK fund manager Anthony Bolton, of Fidelity, said on Monday he was employing five different corporate investigation firms to check up on Chinese investment targets after a disastrous year in which the value of some of his fund's assets have slumped on the suspicion of fraud.
http://www.guardian.co.uk/business/2...banking-system
PS - Ah - The 'Smoke & Mirrors' of it All..!
Empty Cities...
+ This...
The review is the first time the IMF has reviewed the Chinese banking system.
Reviewed for the 1st time? How 'Convenient'..!
+ This...
Secret no more, US moves openly to block the rise of China.
Hillary Clinton and the New American (Pacific) Century
November 16, 2011 - Secretary of State Hillary Clinton recently published in Foreign Policy magazine, "America's Pacific Century,""America's Pacific Century", a Hitlerian declaration of imperial intent for American "leadership" in Asia for the next 100 years.
The piece, which could just as easily been penned by Neo-Con policy makers begins with, "the future of politics will be decided in Asia, not Afghanistan or Iraq, and the United States will be right at the center of the action. "
Of course, America's presence throughout the Middle East and the control it exercises over the region's oil resources as well as over the region as a logistical hub is essential in tempering the rise of Asia and ultimately hemming in the rise of China and Central Asia. The "Arab Spring" which Secretary Clinton and the US State Department had been a part of preparing, equipping, training, and even arming for at least 2 years prior, is the coup de grâce meant to completely overturn the multi-polar nature of the Middle East and ultimately the world.
Upon reading Clinton's declaration of intent for American leadership into the next century, readers may recall the similarly named, ranting "Project for a New American Century" signed off on by some of America's most notorious Neo-Conservatives, which almost verbatim made the same case now made by Clinton. In fact, America's evolving confrontation with China, marked acutely by Obama's announcement of a permanent US military presence in Australia just this week, is torn directly from the pages of decades old blueprints drawn up by corporate-financier funded think-tanks that truly rule America and its destiny.
As reported in June, 2011's "Collapsing China," as far back as 1997 there was talk about developing an effective containment strategy coupled with the baited hook of luring China into its place amongst the "international order." Just as in these 1997 talking-points where author and notorious Neo-Con policy maker Robert Kagan described the necessity of using America's Asian "allies" as part of this containment strategy, Clinton goes through a list of regional relationships the US is trying to cultivate to maintain "American leadership" in Asia.
For example, the recently reinstalled Wall Street proxy regime in Thailand led by Thaksin Shinawatra and his sister Yingluck, has received reassurances by Clinton herself just this week stating that, "it is in the national security and political interest of the United States to have this government succeed." As reported in-depth in "CONFIRMED: Thailand's "Pro-Democracy" Movement Working for US," Thaksin Shinawatra and his political regime have had long standing, well documented ties to Wall Street and London. The US backing of puppet-regimes like Thaksin, installing them into power, and keeping them there is central to projecting power throughout Asia and keeping China subordinate, or as Kagan put it in his 1997 report, these proxy regimes will have China "play Gulliver to Southeast Asia's Lilliputians, with the United States supplying the rope and stakes."
It is essential to look past the empty rhetoric of "democracy," "human rights," and "progress" used to justify foreign-funding and meddling to install servile autocrats like Thailand's Thaksin or Malaysia's stooge dictator-in-waiting Anwar Ibrahim and see the greater geopolitical game at play and the disastrous conclusion it is leading us all toward. It is also essential to expose the disingenuous organizations, institutions, and media personalities helping promote this global corporate-fascist agenda.
Above all, it is important not to allow ourselves and our countrymen to be manipulated and their lives wasted in the inevitable conflicts that are sure to arise as Wall Street and London struggle to maintain, or even expand their global financial, economic, and military hegemony.
http://landdestroyer.blogspot.com/
+ This...
The 'Shell Game' continues...
PSS - (Chinese) Hong Kong 'Economist' Larry Lang is right, However...
Remember - "Problem / Reaction / Solution"..!
There is a 'Far Bigger' AGENDA! This to me is just 'Proves' they are 'NWO Globalist Mafia are 'ALL IN IT TOGETHER'. (including China)..!
= This
NWO Globalists Criminal (Mafia) Solution..?
(One World Govt. & Currency)..!
(Gee Whiz) Who would have 'Thought'..?
98, Executive turbo estate in aluminum silver. The stealth wagon! Now departed, New project Xsara VTR-8 in progress, Next Project, 406 D8 / JAP. So will be looking for a 406 again when the xsara is done!
Thats old news mate,
