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"Good grief," is Patrick Chovanec's response to HSBC's saying "China may have to rely more on...

"Good grief," is Patrick Chovanec's response to HSBC's saying "China may have to rely more on investment to stimulate the economy," following the release of very weak export data. More empty cities coming?
Comments (5)
  • China should be moving more toward consumer based economy. Higher incomes and stronger currency there coupled with gov't healthcare insurance program expansion should ignite an explosion in consumer demand creating more jobs and ultimately higher standards of living.
    10 Dec 2012, 09:17 AM Reply Like
  • That's the trick isn't it... Low savings rate in the US comes at the cost of a strong government backed safety net. High savings rate in China seems to be a result of little to no traditional safety nets and memories of death by starvation in the not too distant past.

     

    US based folks often fail to realize the correlation, assuming that decimating safety nets would be net good because the government is wasteful. I'm not so sure; and I suspect the exercise in diminishing US safety nets would result in a concurrent reduction in consumption, economic activity, and GDP growth. Tough cookie to crack.
    10 Dec 2012, 11:13 AM Reply Like
  • The germans keep reliving the hyperinflation, we Americans keep reliving the great depression .. and Chinese keep reliving the famine of 1959-1961 that caused some 30 million+ peasents to starve to death.

     

    You're right on.

     

    You cracked it.. US savings rates will surge once our bonds collapse and safety net collapses with it.. 2015-2017.. after Japan and Europe's bond markets collapse I figure.
    11 Dec 2012, 09:02 AM Reply Like
  • " Americans keep reliving the great depression"

     

    Though not to well versed in that history, don't think credit was so abundant, nor consumption so frivolous during the 1st Great Depression.
    11 Dec 2012, 06:23 PM Reply Like
  • That is the obvious pressing matter with Global slow down and for demand for both import and domestic goods.
    10 Dec 2012, 09:21 AM Reply Like
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