China's Lehman Brothers Moment? (bloomberg.com) 107
The New York Times: Angry home buyers are waiting on as many as 1.6 million apartments. Suppliers that sold cement, paint, rebar and copper pipes are owed more than $100 billion in payments. Employees who were strong-armed into lending are panicking now that the company cannot repay them on time. China's Evergrande Group, the embattled property developer whose towering debt has set off panic in global markets, is buckling under the weight of more than $300 billion in debt. The company's billionaire chairman told employees on Tuesday that they would "walk out of darkness as soon as possible." But the question for many is whether the company can stumble out of its current crisis on its own without being led by Beijing. And experts are making increasingly grim predictions about Evergrande's ability to hold on without a government bailout, and the consequences of a possible collapse. Matt Levine, writing at Bloomberg: Much of the writing about Evergrande has been about "is this China's Lehman moment?" The main lesson of Lehman was that the collapse of a big levered interconnected firm could cause serious economic damage, and since Lehman, financial regulators in the U.S. and Europe have done a lot of work on reducing leverage and interconnection and damage.
But another lesson, one that I think about a lot around here, is that the way to reduce systemic risk and potential bailouts is for everyone to know how much risk they are taking, for risks to come with clear warnings and accurate labels, and for the risks to be taken by people who can handle them. If you must have big interconnected companies, it is good to know in advance whose claims are senior and safe and who is taking a big gamble in the hope of a high return. It is fine for a company to fund itself by selling speculative investments to retail gamblers, and it is fine for a company to fund itself by selling safe-as-houses investments to retail retirement savers, but either way it is important for people to know which one they're buying.
Much post-Lehman financial regulation is about this sort of labeling: The way to prevent after-the-fact government bailouts is by making sure that risk is borne by people who bear it knowingly and can afford to. When companies fail, people will lose money, and you want to be able to say to whoever loses money, "well, you knew what you were getting into." Here that seems hard! Evergrande got its financing from absolutely everyone -- banks, investors, suppliers, customers, employees -- and it seems unlikely that they all knew what they were getting into. Its capital structure branches out everywhere; there are all sorts of sympathetic people who might lose money, and it is not obvious who should be rescued and who shouldn't be. Do you give the apartments to the people who put their hard-earned money into apartment deposits, or the ones who put their hard-earned money into wealth management products? Eventually either Evergrande will muddle through, or it will get a bailout, or it won't and people will lose money. But the long-term work of making sure this doesn't happen again is mostly about transparency, about allocating risks clearly in advance so you don't have to sort them out in hindsight.
But another lesson, one that I think about a lot around here, is that the way to reduce systemic risk and potential bailouts is for everyone to know how much risk they are taking, for risks to come with clear warnings and accurate labels, and for the risks to be taken by people who can handle them. If you must have big interconnected companies, it is good to know in advance whose claims are senior and safe and who is taking a big gamble in the hope of a high return. It is fine for a company to fund itself by selling speculative investments to retail gamblers, and it is fine for a company to fund itself by selling safe-as-houses investments to retail retirement savers, but either way it is important for people to know which one they're buying.
Much post-Lehman financial regulation is about this sort of labeling: The way to prevent after-the-fact government bailouts is by making sure that risk is borne by people who bear it knowingly and can afford to. When companies fail, people will lose money, and you want to be able to say to whoever loses money, "well, you knew what you were getting into." Here that seems hard! Evergrande got its financing from absolutely everyone -- banks, investors, suppliers, customers, employees -- and it seems unlikely that they all knew what they were getting into. Its capital structure branches out everywhere; there are all sorts of sympathetic people who might lose money, and it is not obvious who should be rescued and who shouldn't be. Do you give the apartments to the people who put their hard-earned money into apartment deposits, or the ones who put their hard-earned money into wealth management products? Eventually either Evergrande will muddle through, or it will get a bailout, or it won't and people will lose money. But the long-term work of making sure this doesn't happen again is mostly about transparency, about allocating risks clearly in advance so you don't have to sort them out in hindsight.
Lesson (Score:1, Informative)
A house is not, and has never been, an investment. It is a liability.
The end.
Re: (Score:3, Informative)
Correct, for most homeowners. Houses decay, appliances require maintenance, and houses have interest, utility, and insurance payments.
But if you have tenants who cover all that, then I think you can fairly call it an investment.
Re: (Score:1, Insightful)
Well especially if you rig the taxation system as has happened in Australia.
Re:Lesson (Score:4, Informative)
But if you have tenants who cover all that, then I think you can fairly call it an investment.
TFA is about China. In China, rents are nowhere near enough to pay a mortgage. Typically less than 30%.
China has a very strong "ownership culture". They want to buy real estate even if it makes far more economic sense to rent.
The female birth dearth makes the distortion much worse. The 30 million girls who were never born mean 30 million men who will never marry and never have a family. So they need to own a house and a car to be competitive. Their families will scrimp and save to help them do that because no daughter-in-law means no grandkids.
Re: (Score:1)
TFA is about China. In China, rents are nowhere near enough to pay a mortgage. Typically less than 30%.
China has a very strong "ownership culture". They want to buy real estate even if it makes far more economic sense to rent
Why then does TFA talk about "apartments" not condos?
Re: (Score:2)
Why then does TFA talk about "apartments" not condos?
A condo is an apartment that is owned by the family living in it.
In Chinese, the same word is often used for both. In American English, it is also common to call a condo an apartment.
TFA is about buyers, not renters.
Re:Lesson (Score:5, Informative)
I believe the word you were looking for, rather than 'liability', was 'asset'. Still not the same as 'investment', but 'asset' better reflects the stored value potential of a thing you can own, versus a thing you will only ever owe upon.
Yes, the mortgage is a 'liability', but that isn't the total story of the house itself, that's just a tool for how you might have purchased it without having the cash on hand to pay in full up front.
Thank you for coming to my TED talk on the basics of accounting principles.
Re: (Score:2)
There's an alternate way of accounting that says:
1) Anything that costs you money is a liability.
2) Anything that makes money for you is an asset.
It draws emphasis to the point of which things are making you money, and which are costing you money. By that approach, a house can be a liability.
Re: (Score:3)
The term I use for a home is “depreciating asset.” My house requires about 3% of the purchase price in taxes and annual upkeep, and the market value does little more than track real inflation. A condo is a little worse, maybe 4%, and market value only tracks official inflation.
Re: (Score:3)
My old apartment is rented out and I'm paying tax on it now - earning more than all the costs associated with it. By the time it's paid off the building may be worth nothing, but overall the land value apportioned to my little unit is
Re: (Score:2)
My home is up about 25% in a year but that doesn’t really change the math. What it really means is inflation is up nearly 15% (I got about 10% below market value due to fortunate timing). Be careful taking out home equity, even to invest— if the investment goes sideways that is money you cannot put towards the cost of a new home when you sell.
Re: (Score:2)
Re: (Score:2)
I think there are two main drivers for increasing property value:
1) Increasing local population (this includes migration from urbanization)
2) People want bigger homes that take up more space
Here I'm ignoring cost of capital, as I think it's more a reflection of the current interest rates than actual underlying long-term value.
When I think about it, it seems to me that 1) is fading away in the long term. So if we're talking about 30-40 years investment, I think you need to think really hard about 2) and poss
Re: (Score:2)
I think there are two main drivers for increasing property value:
1) Increasing local population (this includes migration from urbanization)
More a lack of supply - immigration (on the wane for now) and internal migration (significant, especially with COVID and certain areas doing better than others), foreign investment (potentially a bit of a bust with Evergrande), and legislation that does not allow ready increases in supply (no changes expected).
2) People want bigger homes that take up more space
Not quite as big an issue with Australians - we prefer a backyard, which is proving a lot harder to retain when you can subdivide and sell it up to fully pay off your mortgage...
Here I'm ignoring cost of capital, as I think it's more a reflection of the current interest rates than actual underlying long-term value.
Low interest rates ar
Re: (Score:3)
I believe the word you were looking for, rather than 'liability', was 'asset'. Still not the same as 'investment', but 'asset' better reflects the stored value potential of a thing you can own, versus a thing you will only ever owe upon. Yes, the mortgage is a 'liability', but that isn't the total story of the house itself, that's just a tool for how you might have purchased it without having the cash on hand to pay in full up front.
And the problem is this is less than 5% of the picture, during the last housing collapse the problem wasn’t sub prime mortgages - everyone knew they were a bit dodgy - but the fact that they were rolled up into mortgage backed securities leveraged $20 for every $1 of actual assets and the risky basis of origin lied into an A rating to maximize the impact. Without those derivatives to soak unheard of losses the impact would have been minor in comparison.
But don’t worry, those pesky regulation
Re: (Score:2)
Re: (Score:1)
In a mortgage if you default on payments you lose everything you paid so far, and the asset. So it has a sort of shadow liability matching the asset of the equity.
Re: (Score:1)
Re: (Score:2)
The land may be an asset, but the home on the property is a liability. The house is in a continual state of degradation and requires money to upkeep. The money you put in is likely to only keep the value stable, even if it's outright an upgrade. You may pay $10k to put in triple-pane windows that save you energy, but it's going to be very hard to ask for an extra $10k on the selling price of the home just because you did. The house can have any number of things go wrong with it, even if you have insurance.
Re: Lesson (Score:3)
Re: (Score:2, Informative)
China faces a potential Lehman moment. Wall Street is unfazed [cnn.com]
Wall street was "unfazed". This week it's a disaster nobody saw coming. Next week it will be something else.
Re: (Score:3)
A house is not, and has never been, an investment. It is a liability.
The end.
Bankruptcy is a valid tool of punishment. Too Big To Fail, is not.
The end.
Any moron can oversimplify the living shit out of something. Why you tried to choose something as Greed-bound as real estate is beyond me. Real estate investing has been the fucking mantra of most get-rich-now-and-forever schemes for the last century. And houses have been considered proven investments for at least the last 50 years. It ain't going away anytime soon. Your lesson, isn't one.
Re: (Score:2)
Everybody ended up being a lender to Evergrande. Investors, people who bought apartments, suppliers and builders, banks, etc. You are really over simplifying not only the Evergrande situation but also the Lehman situation as well. It is not like this was purely driven by people buying apartments to make money. There is a whole gigantic system behind it.
Re: (Score:1)
People who bought apartments and companies that supplied materials and labour should be bailed out first - they are paying up front for a product, or have supplied materials and labour - though material and labour should be probably paid back at cost price, not with some large profit.
Individual employee lenders and banks should be paid back next, again, capital only, no interest. Any time you lend money, the risk/reward should be considered as part of your lending criteria.
Shareholder investors should be a
Re: (Score:2)
I mean, sure. Maybe. But when you get into it, it generally gets very messy. Also, the idea that the money still exists and can be paid back is probably not correct. China will have to print the money or sell bonds on the open market to raise capital to pay people back. Evergrande is not solvent.
Some of the people who invested could be running pension funds or something (I mean, I don't know much about China... but in the west, pension funds are some of the largest institutional investors out there). So you
No socialism for the rich in China? (Score:2)
That's the joke I was looking for. Slashdot let me down again.
Not really funny, but tedious hard to explain why Xi wants to leash and muzzle certain politically unreliable rich people in China. Whatever Xi worships, it does not appear to be money.
(Ignoring the AC BFP (Brain Fart Post).)
Re: (Score:2)
Whatever Xi worships, it does not appear to be money.
He's simply trying to keep the line between "functioning autocracy" and "peasant revolution" as thick as he can. A "let them eat cake" moment won't work too well for him.
Re: (Score:2)
What?
Or is it my fault for not being clear enough about the poorly attempted joke? I should have explicitly mentioned the "mandate of heaven"?
Re: Lesson (Score:2)
Houses are assets. Mortgages are laibilities.
The Chinese government will step in (Score:4, Interesting)
Still, China may not have civil rights but they do have a functioning government, so unlike what the US let happen in 2008 this is going to be just fine (save for a few people who are probably going to get executed).
Re: (Score:3)
and fix it, which has created an absolutely hilarious scenario where Wall Street is banking on the Communist Party of China to save capitalism.
You think that's hilarious? Here in the country of wall street, we have a "democratic" party that won't lift a finger to save democracy, and a "conservative" party that actively fights against efforts to conserve things. They are as accurately named as the "communist" party of China...
They won't fix it to Wall St's satisfaction (Score:2)
And China will have the last laugh because the bailout they appear to be executing only applies to domestic concerns such as Evergrande's domestic customers, suppliers and smallish lenders. The CCP has no intention of bailing out Blackrock, HSBC, etc.
I have a colleague who smugly told me China chose power over prosperity. Of course they did. China doesn't have the ti
Re: (Score:1)
China is hardly communist. They are as capitalist as we are. Capitalism won out everywhere. You, however, will be lower middle class all your life.
And you will be one of those people for the rest of your life who's constantly on the cusp of becoming a billionaire just as soon as your current get-rich-quick scheme pays off with some help from the grand Poobah who runs your wealth ministry.
Re: (Score:2)
You don't know that! For all we know, maybe he'll be able to reach upper lower class!
Re: (Score:2)
Re: (Score:3)
Re: The Chinese government will step in (Score:5, Insightful)
They are state led capitalists.
That is literally the definition of fascism.
Re: (Score:2)
Directly from wikipedia:
Fascists believe that liberal democracy is obsolete and regard the complete mobilization of society under a totalitarian one-party state as necessary to prepare a nation for armed conflict and to respond effectively to economic difficulties.[9] A fascist state is led by a strong leader (such as a dictator) and a martial law government composed of the members of the governing fascist party to forge national unity and maintain a stable and orderly society.
Pretty much exactly describes
Re: The Chinese government will step in (Score:4)
Re: (Score:2)
Fascism is NOT an economic system. (Score:2)
I.e. There is no such thing as a definition of fascism equating it merely to state-led capitalism.
Fascism is a faux-conservative death cult whose purported goal is restoration of some past golden age of the fatherland through self-sacrifice of the people in a heroic war against "the enemy".
Actual purpose of fascism is to bring about a dictatorship run by a patriarchal "Glorious Leader" OR a working oligarchy without internecine tendencies.
I.e. It's a monarchy or feudalism with extra steps. Most of the extra
Re: Fascism is NOT an economic system. (Score:2)
There are many definitions to fascism. To the point where it's not a useful term to describe any system of government.
The problem is any definition that includes WII-era Germany and Italy is also going to include a lot of other states that we generally don't view as fascist (like China).
Some scholars have posited a cultural callback element that you describe here. Germany with Teutonic knighthood, and Italy with Medieval Catholic supremacy. But that's not a universal or even standard element of what is refe
That's a bullshit argument. (Score:2)
Basically arguing that "since we can't establish a 100% accurate definition of fascism" (No True Fascist fallacy) and "since people overuse the term it has thus lost all meaning" (argument from and for ignorance) - ergo, we simply can't really tell when fascism.
Oy vey.
Which is bullshit.
I could argue further why and how that's bullshit, or how all that doesn't refute the fact that there is no such thing as a solely economic theory of fascism (nor can there be one) - but why bother.
Re: (Score:2)
I.e. There is no such thing as a definition of fascism equating it merely to state-led capitalism.
"When people hear the word “fascism” they naturally think of its ugly racism and anti-Semitism as practiced by the totalitarian regimes of Mussolini and Hitler. But there was also an economic policy component of fascism, known in Europe during the 1920s and ‘30s as “corporatism,” that was an essential ingredient of economic totalitarianism as practiced by Mussolini and Hitler.
-- https://fee.org/articles/econo... [fee.org]
"Fascist economics supports a blend of both private and publi
Let it fall (Score:5, Insightful)
Too many people in China think a 15% riskless return in a low inflation environment is a completely normal. It was possible for these wealth products to actually pay that type of return for years because the economy was growing so fast. People got greedy. Now is the time to learn. The higher the rate or return over government bonds, the more the risk.
I feel for the small suppliers. They need the business to survive. They don't have any choice but to accept terrible payment terms. The can't negotiate. Evergrande really can tell them "take it or leave it." Large suppliers should know better. Once a payment is overdue, the cement shipments stop until the account is paid up and back to terms.
On this note, it would be nice to see some more regulations in the US around this topic. Too many large companies (the GE's of the world), force unreasonable payment terms and other needless terms on smaller suppliers. Asshole lawyers and CFOs write ridiculously one sided contracts and force small suppliers to take it or leave it. A good contract should be balanced.
Oh nooze... (Score:3)
What, China become socialist? Who'd a thunk?
Re: (Score:2)
Re: Oh nooze... (Score:2)
Nothing about socialism implies liberal. You're putting up a straw man.
Re: (Score:2)
Too many people in China think a 15% riskless return in a low inflation environment is a completely normal. It was possible for these wealth products to actually pay that type of return for years because the economy was growing so fast. People got greedy. Now is the time to learn.
More to the point, the government has been bailing these companies out when they failed. Now they decided not to. Imo that's a good decision but also idk the future will tell.
Re: (Score:2)
The problem is nobody thinks they will be the ones holding the bag when the music stops.
There is also the fact that humans in general are very poor evaluators of risk, especially against reward. Risk is much more complicated than people often expect; even when formal analysis is done, often consideration of things like multiple “acts of god” occuring at the same time is either over-looked or under-appreciated. Government regulations/policy changes are even worse.
I had a project once where a ne
Re: (Score:2)
Xi hates poverty. He grew up in it and went into politics to fight it. He will not left ordinary people be the victims here. The company owners will be the ones suffering, the government will step in and nationalize the company if required, and probably throw them in jail too.
TBH we could do with some of that here. Back in 2008 some bankers should have gone to jail and we should have nationalized banks instead of giving them free money. Actually the UK did nationalize one, but eventually sold it at a modest
Land is the investment property is the asset. (Score:2)
Re: (Score:1)
How much is Chernobyl worth then?
Re: Land is the investment property is the asset. (Score:2)
Re: Land is the investment property is the asset. (Score:4, Informative)
How much is land in Detroit or rural areas worth?
Re: Land is the investment property is the asset. (Score:2)
Re: (Score:2)
Seems like there are 2 problems with that. You might not live to see the "longterm" and most years you would have done better playing Stocks.
Re: Land is the investment property is the asset. (Score:2)
Re: (Score:3)
Longterm land is always going to be worth more than you paid for it
In China, you don't own the land. You only own the building. All land belongs to the government.
Re: (Score:2)
Longterm land is always going to be worth more than you paid for it
In China, you don't own the land. You only own the building. All land belongs to the government.
It's not really all that different in America when you consider Eminent Domain is a valid tool that has been used plenty of times, and it doesn't matter if you've own land "free and clear" handed down from your great-great-grandfather. Don't pay your property taxes, and you won't own it anymore.
Re: Land is the investment property is the asset. (Score:2)
Re: (Score:2)
...and in Soviet Russia, the building owns you!
(I'm sorry.)
1989 Part 2. (Score:2)
Re: (Score:2)
It seems unlikely, the CCP is more popular than ever in China. The proletariat likes a lot of the recent reforms.
Re: (Score:2)
Exactly. The CCP has in very clear terms, put big business on notice in MANY ways. I imagine this should be effective in securing strong domestic support, which may be the main purpose of it.
Re: (Score:2)
Re: (Score:2)
Yes, maybe. But the CCP can blame the people who ran Evergrande and use it as an excuse to regulate commercial activity even more than they already do.
NO (Score:2)
China is doing fine for what it is and does not need freedom but more prosperity. Pampered Westerners forget how far China has come since unification in 1948.
There are no conditions in China worth destroying the economy for a revolution.
No one at Lehman was executed. (Score:2)
The CCP has a different way of handling things.
Re: (Score:2)
I trust Biden and crew will protest and try to sanction China for its use of the death penalty.
Hard to see how stealing that much money doesn't earn the death penalty. Top executives are able to do great things (such as giving 100,000 people jobs, and the huge amount of the taxes all those workers pay) and the unspeakable (such as losing the life savings of vast numbers of people who can least afford it). The actual damage to society can be very high. I'd argue for not just the death penalty, but a painf
Re: (Score:2)
Counter argument (Score:4, Informative)
Wall Street says no [marketwatch.com], this will not be like Lehman. In short, there won't be enough spillover from an Evergrande default like what happened at Lehman (and other firms who blatantly ignored mark-to-market valuations). There would have to be a whole series of unlikely events to occur for this to come close to Lehman.
Re:Counter argument (Score:5, Interesting)
Yup. China's very protective of their equity and debt markets. They only (relatively) recently opened up their corporate debt markets to foreign investors. And even then, they're doing so at an extremely measured/experimental pace. I guess the CCP realized a few years ago they didn't want to be the only bag holders when their real estate boom busts.
There's a bit of a joke that floats around foreign investment in China, in that getting your money into the country is no problem. But good luck getting your money out. There are CEOs that have spent more than the last 5 years trying to get their profits out of the country, and by implication, out of the yuan... which is a big no-no in the eyes of the CCP.
There's the Great Wall of China, the Great Firewall of China, and the Great Financial Wall of China.
This is why China will be the only one eating at this debt-market-collapse buffet.
Re: (Score:3, Interesting)
The scary thing is that the most sure fire way for any country to get the people's mind off it's economic woes is for it to go and invade somewhere or have some nationalistic event to rally around. This is especially true for dictatorships, though democratic leaders have benefited from this too.
Bush's ratings dropped from 60% to about 50% just before 9/11 but shot up to 85% immediately after, before declining over time to 40% as the economic effect of the Iraq war (justified or not) kicked in.
What will Chin
Re: (Score:2)
Approval ratings don't matter. The CCP does not need "popular support". They don't seek to be liked; they want to be respected. This is one (among many) differences between government in the U.S. and China.
The one thing the CCP wants from the citizens is order. The last thing it wants are the people to have impressions that the CCP is incompetent, or ineffective. But what will the leadership do if things get economically bad? The short answer is, "Whatever it takes". Emphasis on the word "whatever". And the
Re: (Score:2)
Approval ratings don't matter. The CCP does not need "popular support". They don't seek to be liked; they want to be respected. This is one (among many) differences between government in the U.S. and China.
You may have misspelled feared.
Re: (Score:2)
Again, this is a very Westernized (dare I say, American?) understanding of the motivations of the CCP.
Having a population that fears its government creates resistance to that government, and motivates the populace in directions of thinking that the CCP does not want them to pursue. The CCP understands that they could not possibly resist a coordinated movement of +1 billion citizens against them. So, creating
"fear" is counter to the overall goal of the survival of the CCP. Which is why they desire social ord
Re: (Score:2)
Bush's ratings dropped from 60% to about 50% just before 9/11 but shot up to 85% immediately after, before declining over time to 40% as the economic effect of the Iraq war (justified or not) kicked in.
The US didn't invade anyone on 9/11. Your quote indicates that Bush's approval rating went up without an invasion, and then went down due to the effects of a later invasion. Which is sort of the opposite of the point you want to make.
Re: Counter argument (Score:2)
Might be the opposite point being attempted, but it's also true. His approval rate went up immediately based on his rhetoric. And very few were on board with the Iraq invasion. That's around when people started to lose confidence, seeing as no one could explain why we were invading Iraq when we were attacked by Saudis who were smuggled into Pakistan with the help of the Afghanis.
Re: (Score:2)
Re: (Score:2)
Current supply chain disruptions leave me unconvinced. It isn’t hard for unintended spillover, especially when different markets are impacted.
Who can predict the future and be held accountable (Score:1)
Last week a recruiter tried to interest me in a gig at Lucid Motors, (not that they'd probably hire me if I tried). Right there in the job specs., for a 6 month+ contract was to be onsite in Arizona from day 1. No benefits.
I have had to relocate to work in the past, to be clear. And I don't know where my next job will be.
China doesnt do (Score:5, Insightful)
Re: China doesnt do (Score:1)
Re:China doesnt do ... [transparency] - nor us (Score:1)
Transparency. Its straight-up antithetical to [the Chinese] system. .
And the US and UK systems are any more transparent?
A big contributor to the Lehman situation was the opaque dealings in the first place. Unless you think robo-signing is normal behaviour, of course.
OK, maybe they are better now - let's assume "we" learnt some lessons. Except the lessons learnt aren't communicated to the general public so the behaviour might be checked in the US/UK/similar markets for a few years ... until the "learned few" retire and get replaced with new snake oil merchants who haven't "le
Re: (Score:2)
And, Lehman is a perfect example of why the west's system is better. They weren't able to hide it. The government didn't help them avoid consequences. Th
Re: (Score:2)
China will deal with this very simply, by the state simply assuming control of the entire company, probably via the China Construction Bank.
People in the west have a hard time wrapping their heads around this, but in China it is not a big deal. The state controls and runs most of the largest companies in China. Adding another to the pile is not materially relevant whatsoever.
Re: (Score:2)
Re: (Score:2)
China would tend to disagree.
Re: (Score:2)
Re: (Score:2)
When your population is over a billion people, GDP per capita becomes less relevant. What matters is their clout in international markets, which is based on their total GDP number.
The fact is China's overall GDP is on track to surpass the US within the next 5 years, and their military spending will go along with that number. To call them a "second tier" economy is burying your head in the sand, its frankly a ridiculous position to take.
Re: (Score:2)
But I think you're wrong, and I very much stand by my statement. China is still a second-tier economy. They only have 2 things going for them. Number 1: large scale, and that's probably temporary. Number 2: limited capitalism, and that's probably reached it's limits, because the ccp is not
Sometimes regulation is needed (Score:1)
Re: (Score:2)
Re: (Score:2)
This is something I have heard from the FDA a number of times. It is one of the reasons that the regulations are so important and violating them carries such heavy penalties.
Re: (Score:2)
Reported years ago (Score:2)
I'm sure I remember a documentary report on the feverish investment in "ghost" property in China, at least 3 or 4 years ago. This company or another like it were selling off the plan, and eventually building lots and lots of apartment buildings, and the general view of people buying them was that they were a good investment ... even though the majority were never occupied. ... and the
There would be one apartment fitted out for display within a building, all the empty unfinished apartments would be sold off
Re: (Score:1, Informative)
First, consider the COVID-19 pandemic. Biden was supposed to be the antidote to Trump's alleged mishandling of the virus. Yet, the weekly average of COVID-19 deaths is higher now than it was in September 2020. This is even more troubling considering vaccines are available now, whereas a year ago, they were not.
The communication on mask effectiveness and proper setting of expectations on what "vaccination" means/does is still deplorable. However, I'm not being told to inject bleach, "put the UV light on the inside", or being sold (by the President) the latest unsubstantiated twitter miracle cures, so at least the current lack of obviously bad medical advice is a nice step in the right direction.
Next, the country's border situation. Biden's executive actions in his first 100 days reversed several of Trump's immigration policies. The result has been an illegal immigration crisis, a national security calamit y, and a humanitarian catastrophe plaguing the southwest border.
Trump's border policy was a continuation of the Obama-era deportation strategy, an increase in detention for border cross
Re: (Score:1)
> Then there was the Afghanistan fiasco, Biden's biggest embarrassment to date.
Trump was party to that deal. He just wasn't around to see it through. Doesn't seem like an Biden embarrassment.