China's economy is very sick. What to prepare for?

[DrBeer]

It's no secret that after the Kovid pandemic, China's economy has been hit pretty hard. Further problems were a continuation of the economic confrontation with the U.S., which was not a smart move on China's part, as overestimating its strength is the biggest mistake.
Then there was (and now the problem continues) Evergrande and in general the real estate market and related sectors of the economy....

And the day before yesterday the news came out: China is considering the option of withdrawing 2 trillion yuan ($278 billion) from offshore accounts of state-owned companies to save the record falling stock market. Bloomberg writes about it.
According to people familiar with the matter, Chinese authorities are considering a package of measures to stabilize the falling stock market after previous attempts to restore investor confidence failed and prompted Prime Minister Li Keqiang to call for "forceful" steps.

On the one hand, it seems to be the world's second economy, "the world's factory", nominally "the second pole of the bipolar world", on the other hand, it is no longer possible to hide the problems and it is necessary to take such measures.  The question is: since the situation with the Chinese economy is no longer manageable, and we have to take tough and prompt actions to save the economy - how do you think this will affect the global economy, the crypto market, and what to prepare for?

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[Husires]

The reports that come about China, especially from Bloomberg, are not very credible. It is true that the situation in China is bad, but it is not as bad as you expect. China still has huge reserves to face all economic crises, but I see that the speed of armament and the geopolitical challenges are the problem, especially with the military moves towards Taiwan and the approval of the United States. The US Semiconductor Law (CHIPS and Science Act) are all factors that may indicate a new conflict in that region in the coming years.

[DrBeer]

The reports that come about China, especially from Bloomberg, are not very credible. It is true that the situation in China is bad, but it is not as bad as you expect. China still has huge reserves to face all economic crises, but I see that the speed of armament and the geopolitical challenges are the problem, especially with the military moves towards Taiwan and the approval of the United States. The US Semiconductor Law (CHIPS and Science Act) are all factors that may indicate a new conflict in that region in the coming years.

Which I agree with - the media can be distrustful.  On the other hand, at least they provide figures and arguments, not just throwing information around

What I don't agree with is that it's not all bad in China Provided they are extremely trying to hide data about the state of their economy....

Here's a little bit of data on the Chinese economy:
China's Debt-to-GDP Ratio Rises to Fresh Record of 286.1%

The Chinese economy's debt ratio reached a new record high, according to central bank and statistics bureau data compiled by Bloomberg.

The macro leverage ratio - or total debt as a percentage of gross domestic product - inched up to 286.1% in the fourth quarter. The debt ratio held by household and non-financial corporates both declined, while government sector saw an increase of 2.3 percentage points.

Leverage ratio for non-financial sectors declined to 167.3% vs 167.7% in the previous quarter
Leverage ratio for household sector declined to 63.5% vs 63.8% in the previous quarter
Leverage ratio for government sector rose to 55.3% vs 53.0% in the previous quarter

[tyz]

The economic situation in China is difficult to assess, as the official figures cannot be trusted. On the one hand, there are many indicators that point to an economic downturn (real estate prices etc); on the other hand, some international companies are still experiencing growth in their business in China. I follow earnings meetings of European and US companies and for the most part their China business has not disappointed recently. Just the day before yesterday,LVMH Moët Hennessy - Louis Vuitton shares rose 10% as the luxury goods business continues to boom in China.

[DrBeer]

The economic situation in China is difficult to assess, as the official figures cannot be trusted. On the one hand, there are many indicators that point to an economic downturn (real estate prices etc); on the other hand, some international companies are still experiencing growth in their business in China. I follow earnings meetings of European and US companies and for the most part their China business has not disappointed recently. Just the day before yesterday,LVMH Moët Hennessy - Louis Vuitton shares rose 10% as the luxury goods business continues to boom in China.

China's so-called "official statistics" are a sham. The main goal is to "reassure" both external investors and the population of China itself. Otherwise, it will not be possible to attract investment or manage the population.

Imagine what would happen both in China and in the world if tomorrow the head of China came out of the "main rostrum" and said "our economy has collapsed, it is impossible to get it out of the peak without Western investments, markets and technologies".  It will be the collapse of China's industry, domestic producers, and a huge force - social explosion ! I do not think that the Chinese government, which has chosen the vector of totalitarian development, will agree with this. Therefore, the real level of problems can be judged by secondary signs, it is much more difficult to hide them, because in fact, it will be necessary to classify any steps of the government regarding the financial system and the economy.

And these secondary manifestations now show that China is trying to take extraordinary steps to somehow stop the decline.

[jossiel]

As for crypto market, I don't know if we're going to see its impact from here. But if it's with their own economy and their connection to the global competitiveness of most markets that can be found on their main land. If there's a drastic fall to it, I think that we'll really know but I'd agree with husires that media can manipulate info that they feed to their readers and to the world.

While it's the opposite of what I've seen from the updates that I've watched and read, it's hard to extract the actual ones. But one thing is for sure is that, China can stand on its own no matter how they're portrayed by the media, how weak the economy they currently have.

[8rch7]

May I know do you have accurate source information about China's economic very sick right now? I don't sure with current China's economic not stable yet because they have many debt around the world of country. My country Indonesia have to pay much loan for China with fast train project and I don't sure China have weakness condition with their economic.
Due pandemic is not problem for them because they have success make many way to get income with country faced pandemic, very difficult to see opportunity with China economic collapse just update to media only about the fake of economic condition. Possibility with China want to make less pressure from United State and slowly for upcoming update they will publish with current economic condition get growing up drastically.

[DrBeer]

May I know do you have accurate source information about China's economic very sick right now? I don't sure with current China's economic not stable yet because they have many debt around the world of country. My country Indonesia have to pay much loan for China with fast train project and I don't sure China have weakness condition with their economic.
Due pandemic is not problem for them because they have success make many way to get income with country faced pandemic, very difficult to see opportunity with China economic collapse just update to media only about the fake of economic condition. Possibility with China want to make less pressure from United State and slowly for upcoming update they will publish with current economic condition get growing up drastically.

The fact that Indonesia owes China is not an indication that China is doing well !
As you know - China makes inaccessible all or most of the data on its economy, gold and foreign exchange reserves and other data, by which you can clearly assess the state. And this is clearly not done out of a desire to hide its greatness and power ... But the "health of the economy", as I have already said, can be monitored by other, secondary indicators.
I can explain what is happening to the Chinese economy by the example of human health - outwardly a person is healthy, he tells everyone that he is fine, but inside he develops a disease that he hides. The person hides it, and tries to show his good "condition". But at the same time we can observe that he loses weight, he has got puffiness, often looks very tired, and constantly goes to doctors and pharmacies buying mountains of pills. Exactly the same thing is happening to China right now....  It's almost panic-stricken, looking for "cures" to cure its economy.

A small set of facts: investor outflow, technology outflow, decrease in trade with major profit-making consumers (USA, EU,...), search for funds, tough administrative measures in the economy....

[franky1]

It's no secret that after the Kovid pandemic, China's economy has been hit pretty hard.

from all reports (not western media)
in 2019 china did not want to rush to judgement about outbreak until it was truly confirmed even while doctors were gossiping on social media about their patients new symptoms
but by 2020 china announed it and instantly went into hospital building and they managed their covid issues faster then US/UK

so pretending china was hit hard is a stretch compared to people in america having issues even in 2022-24

Further problems were a continuation of the economic confrontation with the U.S., which was not a smart move on China's part, as overestimating its strength is the biggest mistake.

spy balloons? not really in comparison to N.korea threatening nukes, or russia going to war..
come on now. dont go full exagguration

Then there was (and now the problem continues) Evergrande and in general the real estate market and related sectors of the economy....

yep they did 'dun goof' on that, over developed property with an expectation of a baby boom from 2016+, which never happend due to the young female adults still indocrinated with their sex education of one child parenting (they should have waited a decade for the post 2016 pupils taught aof 2-3 child parenting to then grow up into adults to then be at the age to settle down and want multiple room apartments

in short they shot for glory too early. but the apartments will be ready by the time those pupils taught that 2-3 kids is fine, grow up to be ready to start a family.. so just a delay, not a complete loss

And the day before yesterday the news came out: China is considering the option of withdrawing 2 trillion yuan ($278 billion) from offshore accounts of state-owned companies to save the record falling stock market. Bloomberg writes about it.
According to people familiar with the matter, Chinese authorities are considering a package of measures to stabilize the falling stock market after previous attempts to restore investor confidence failed and prompted Prime Minister Li Keqiang to call for "forceful" steps.

well china taking wealth out of the us to concentrate on chinese projects.. logical
much like saudi taking money out of china to concentrate on saudi neom city.. logical

On the one hand, it seems to be the world's second economy, "the world's factory", nominally "the second pole of the bipolar world", on the other hand, it is no longer possible to hide the problems and it is necessary to take such measures.  The question is: since the situation with the Chinese economy is no longer manageable, and we have to take tough and prompt actions to save the economy - how do you think this will affect the global economy, the crypto market, and what to prepare for?

not manageable.. ?
last time i checked it was the US raising the debt ceiling and then having government take administrative breaks.
last time i checked america lost control of its borders
last time i checked america had more mexicans in detention camps than chinese had uyghurs in detention camps

im ancestered, born and raised british(western) but even i can see passed all the FUD of the fox news style rhetoric throwing muffled numbers about to try to make china look bad to hide how bad things are getting in the US

im guessing you are probably in the fox new-esq belief that china control the citizens lives and finances via an app that requires chinese whole life story and reputation..
well test your theory, go to a travel agent that does currency swaps and ask for yuan.. be surprised they hand you bank notes without needing you to register life to chinese app

[Ryu_Ar1]

It is difficult when talking about China today even though we know their economic conditions are being hit but we do not know exactly how bad their current situation is because after all if we talk about current sources and news the truth is that China always limits itself when talking about the economy and what is happening in their country to the outside public other than in their country so in this case we cannot definitely predict what they are doing.

Indeed in this case I also agree that they are still exaggerating the situation in any case to the public outside their country to show that they are still one of the superpowers apart from America and other big countries but indeed we also cannot comment with certainty because the data and the situation are very difficult for us to reach and we can only speculate in the end.

[el kaka22]

Well, years and years ago, they decided that they can build their own things as well, since they became very efficient and good at what they do. They started the whole thing with a situation where it would be like one dollar per day workers place, so places like nike and so forth would sent their business there, get some shoes and shirts made for a dollar or two, and then they would ship it to USA, the whole cost would be one shirt would cost like a dollar at most, a shoe would be a few dollars at most and they could sell the shirt for 20 bucks and shoe for 100 bucks, now even more.

China took that money, made better factories, made better educated manufacturers, and eventually got to the point where they just have their own brands that they sell to whole world now, so I think they will not need American companies or western companies coming to them for manufacturing, they will simply manufacture their own brand products and sell it to the whole world.

[Kemarit]

The reports that come about China, especially from Bloomberg, are not very credible. It is true that the situation in China is bad, but it is not as bad as you expect. China still has huge reserves to face all economic crises, but I see that the speed of armament and the geopolitical challenges are the problem, especially with the military moves towards Taiwan and the approval of the United States. The US Semiconductor Law (CHIPS and Science Act) are all factors that may indicate a new conflict in that region in the coming years.

But I saw news of them admitting that their economy is really on a bad state, so I don't think that we shouldn't take it for granted or that news agency like Bloomberg is not credible as far as Chinese news is.

https://www.youtube.com/watch?v=AOkV_Fn8K9w

So not really sure though what to made out of this news, they have been in geo-political wars with Taiwan and many South East Asian region with regards to the claim of West Philippine sea. And they are embroiled with US and Europe as well, with trade wars here and there.

[Fortify]

It's no secret that after the Kovid pandemic, China's economy has been hit pretty hard. Further problems were a continuation of the economic confrontation with the U.S., which was not a smart move on China's part, as overestimating its strength is the biggest mistake.
Then there was (and now the problem continues) Evergrande and in general the real estate market and related sectors of the economy....

And the day before yesterday the news came out: China is considering the option of withdrawing 2 trillion yuan ($278 billion) from offshore accounts of state-owned companies to save the record falling stock market. Bloomberg writes about it.
According to people familiar with the matter, Chinese authorities are considering a package of measures to stabilize the falling stock market after previous attempts to restore investor confidence failed and prompted Prime Minister Li Keqiang to call for "forceful" steps.

On the one hand, it seems to be the world's second economy, "the world's factory", nominally "the second pole of the bipolar world", on the other hand, it is no longer possible to hide the problems and it is necessary to take such measures.  The question is: since the situation with the Chinese economy is no longer manageable, and we have to take tough and prompt actions to save the economy - how do you think this will affect the global economy, the crypto market, and what to prepare for?

Before Xi Jinpig, China had a chance - they were opening up both economically and also to people who wanted to explore the country. They relaxed massively from the devastating era of Chairman Mao, which crippled them. That is the era that brought so many people out of poverty and it had the potential to keep winning by using that strategy. However now we have a meddling dictator again, who undermines any pretense of independent law and order. That targets business sectors seemingly at random - driving away the overseas investment that helped them flourish. He allows bubbles to grow, because on paper it gave the illusion that China was even richer. He also knocked out political opposition, which ends up with the leadership living in an echo chamber that will end up in their own demise.

[btc78]

Is China’s economy slowing down? Yes. Will they go down very soon? Probably, no.

China has been considered a giant when it comes to economy they have been top of the game for so long and everyone knows that you can not take down an empire in just one day it might go down to second or even third place but the gradual slow down of their economy is not yet that alarming

Since a lot of products come from China, we can expect that if their economy slows down so will the manufacturing of goods which will impact the rest of the world As for cryptocurrency, it is still unclear if China’s economic status will have any direct impact not to mention that China’s stand on cryptocurrency remains against it the real impact on cryptocurrency will be seen once the authorities give their final say regarding their stand on crypto

[wxa7115]

The reports that come about China, especially from Bloomberg, are not very credible. It is true that the situation in China is bad, but it is not as bad as you expect. China still has huge reserves to face all economic crises, but I see that the speed of armament and the geopolitical challenges are the problem, especially with the military moves towards Taiwan and the approval of the United States. The US Semiconductor Law (CHIPS and Science Act) are all factors that may indicate a new conflict in that region in the coming years.

But I saw news of them admitting that their economy is really on a bad state, so I don't think that we shouldn't take it for granted or that news agency like Bloomberg is not credible as far as Chinese news is.

https://www.youtube.com/watch?v=AOkV_Fn8K9w

So not really sure though what to made out of this news, they have been in geo-political wars with Taiwan and many South East Asian region with regards to the claim of West Philippine sea. And they are embroiled with US and Europe as well, with trade wars here and there.

And since the waters are muddied and we do not know what to expect we need to take some measures, even if China were not to face the most dramatic scenario, the scenario that is coming does not seem to be favorable to them, so we need to do what we can to protect ourselves in the case the country or region where we live is affected by this.

And this means reducing our expenses, getting rid of any debts we may have and invest in assets which may do well during such difficult times, however I would suppose many forum members should be doing this already and there is not much for them to do anymore.

[icalical]

I don't how China is doing in their internal affairs, but as far as I know up until now they still loan their money to other countries including my country Indonesia and some other south east asian country I think. And they have been loaning their money to many African Countries over the year, I guess they should stop loaning their money from now on.

[bluebit25]

The overall condition of the world economy is sick, not just China's, but if big countries have problems, they will also lead to developing countries and poor countries, it's not natural the chaos of recent years has become widespread. I'm not the type of person who reads news in one direction, like Great America, or the Chinese superpower,... so with economic issues we should be frank and open about the recession, as well as finding solutions to each scale.

As for the people, I am quite free and comfortable, but I also know the chaos elsewhere that is not blessed with peace (both war conflicts, work situations, environment,...) so how to prepare is partly everyone's responsibility, and it seems we still have to adapt to change no matter how it turns out.

[pinggoki]

Prepare to laugh at the CCP because they're the architect of their own demise and their corruption is what lead to all of this happening, building condominiums and then demolishing them the next day because no one can afford real estate there and the continuous suppression of information because they don't want to look weak to their neighbors and the desire to reclaim Taiwan when they could've focused on doing the right thing and removing Xi Jinping from power because he's slowly gathering loyalists in the government and soon, it's going to be a totalitarian mess and we've seen what happens to an economy that's totalitarian, it's always in shambles. I hope that the people all over the country of China start something like a revolution but for the better because they're the ones that's going to suffer in all of this if this continues.

[blockman]

I don't how China is doing in their internal affairs, but as far as I know up until now they still loan their money to other countries including my country Indonesia and some other south east asian country I think. And they have been loaning their money to many African Countries over the year, I guess they should stop loaning their money from now on.

There are too many actions that they're doing on this region. They're too aggressive with our territorial seas nearby to our country, Philippines. And before the new administration has came approximately becoming 2 years by this year, they're too friendly to us thanks to Duterte.
But now, our new president is too attached to the US government and probably startled and triggered the Chinese government and that's why they're bullying us. I don't think with these actions they've been doing is that their economy is sick right now, with giving loans to their allies left and right. That doesn't show that they're on the verge of going downhill.

[0t3p0t]

The reports that come about China, especially from Bloomberg, are not very credible. It is true that the situation in China is bad, but it is not as bad as you expect. China still has huge reserves to face all economic crises, but I see that the speed of armament and the geopolitical challenges are the problem, especially with the military moves towards Taiwan and the approval of the United States. The US Semiconductor Law (CHIPS and Science Act) are all factors that may indicate a new conflict in that region in the coming years.

So is it possible that what Chinese president has said is just a diversional tactics so he can have the attention of the international community as stated here? https://youtu.be/AOkV_Fn8K9w?si=XU9xhWx6f5cuW1a9

I can also see Chinese agressiveness in the SCS and other neighbors in the region so why are they doing this when their economy is in trouble, right?
Is it possible that they are using this strategy?

Appear weak when you are strong, and strong when you are weak.

I could be wrong here but yeah propaganda really is misleading.