Christopher Balding, a business professor formerly at Peking University, writes about China's economy, finance, Huawei and US-China relations.
HN commenters recommend it to anyone wanting a realistic picture of China's economy, alongside Michael Pettis, as a good round-up of China news.
From the original article:
"A government directive sent to journalists in China on Friday named six economic topics to be “managed,” according to a copy of the order that was reviewed by The New York Times."
From everything I've read, I would be extremely surprised if journalists are the only ones who receive implicit or explicit "suggestions" on what is acceptable to say, and what is not.
http://www.baldingsworld.com/2018/07/17/balding-out/ (It's an excellent article overall.)
I am leaving China. After nine years working for the HSBC Business School of Peking University Shenzhen Graduate School as a professor teaching international trade, negotiations, and ethics, I am leaving China. In early November 2017, the HSBC Business School informed me they would not renew my contract. In March 2018 they informed me they wished to sever all ties by April 1, 2018.
One of my biggest fears living in China has always been that I would be detained. Though I happily pointed out the absurdity of the rapidly encroaching authoritarianism, a fact which continues to elude so many experts not living in China, I tried to make sure I knew where the line was and did not cross it. There is a profound sense of relief to be leaving safely knowing others, Chinese or foreigners, who have had significantly greater difficulties than myself. There are many cases which resulted in significantly more problems for them. I know I am blessed to make it out.
I'd also be surprised if China is the only…
Or it's because the CCP was cheerleading stocks during the boom, and there was a VAST increase in the number of trading accounts being opened in the run up to the peak. Pensioners put their life savings into the stock market because the government was cheering for it (and it's not always a bad bet to go with what the government is backing). It dropped, what, 30%?
The rules changed so that housing can be used as collateral for margin lending, so a lot of them could have lost a lot.
P/E was about 100. In some cases, earnings might be fabricated. Get a loan (requires good connections), fake revenue, IPO, use the high stock valuation as collateral for the loan (I think this is allowed in China). Get more loans. Fake more revenue. Embezzle a bit. Usually they mean well, and aren't just outright cons, but there was apparently one big one the Hong Kong Exchange (which is usually more rigorous).
Housing can be 10X income. In some places 20X income. It's partly due to the government forcing down interest rates (tightly regulated banks - so savers may have negative real interest). Banks put a loan as doubtful if the debtor has stopped trading for 6 months, so there could be a lot of debt that's not so solid. And no-one knows what GDP is, but it might not be growing as fast as the government says.
An Asian country, with a median age over 35, crony capitalism, high savings rates, possible asset bubbles, a possible stock bubble, a government that's likely to go for bailouts rather…
http://www.prospectmagazine.co.uk/magazine/thatschina
> After seven years building up a magazine empire in China, I had it stolen by the state. I lived in the grey zone that is China's media business and, despite my commitment to the country, paid a high price
https://www.baldingsworld.com/wp-content/uploads/2018/12/An-Innocent-Almost-Felon-Abroad.pdf
> A few weeks later over beers with a lawyer colleague, I recounted my tale of hysterical woe. He informed me that in reality, much of Chinese dispute resolution from neighborhood quarrels all the way through to significant civil and criminal litigation follow a similar pattern with open conflict avoided. According to him, recompense for damages all the way through to incidents involving death can allow people to avoid jail time. What I first thought a mistranslation, Negotiation Rooms existed to serve that purpose where every dispute from noise complaints to many business disputes to many acts that would qualify as felonies resolved themselves with official help in a Negotiation Room. In China as a foreigner, you become so used to being treated differently, both good and bad, that it surprises you to find out your experience is just like everyone else.
Anyone interested in China's real economic condition should have a look at the ongoing analysis by Michael Pettis:
http://carnegieendowment.org/experts/444
And Christopher Balding:
http://www.baldingsworld.com/
Like other China watchers, they tease economic reality out of ancillary economic data that is difficult to spin (eg. capital outflows, HK-China cross-border trade, energy consumption).
The picture is not good. Reforms are needed, to increase low and middle-class domestic consumption; and perhaps a trillion? in non-performing loans must be written off. The rules for foreign trade and investment in China need to be rewritten to allow for unrestricted foreign competition and investment in the broadest of terms. In sum, system inefficiency in China markets must be rooted out quickly to avoid a much worse crisis.
China's too late.
China's Debt to ratio is a staggering 833%
http://www.baldingsworld.com/2017/10/23/everything-we-think-we-know-about-chinese-finances-is-wrong/
Why China Lost About $3.8 Trillion To Capital Flight In The Last Decade
(FDI was only 1.3T over the same decade, leading to a massive loss)
https://www.forbes.com/sites/insideasia/2017/02/22/china-capital-flight-migration/
So no money.....and recently it prevented South Korean companies from withdrawing assets from China. Now companies around the world knows. Who's gonna invest in China now?
http://www.businesskorea.co.kr/english/news/national/19352-exodus-china-s-korean-companies-suffering-omnidirectional-retaliations-china
Yes, and they aren’t the only ones.
We really have no idea how bad the situation is in China.
Their total debt (public, personal, and shadow) to GDP is suggested to be as high as 1660% of GDP. This a staggering amount of money.
What we are seeing is probably the greatest financial crime in history. There is absolutely no way the markets can contain this once this runs its course.
For now no one can do anything. Every time you try to bet against China, more analysts are simply paid off or the Bank of China props up the stock against your shorts.
http://www.baldingsworld.com/2017/10/23/everything-we-think-we-know-about-chinese-finances-is-wrong/