Xi Jinping is embarrassed! Chinese Communist Party Premier Li Keqiang strolls through Shanxi’s New Year’s Eve street without a mask, drawing hot debate among netizens.
How will Xi Jinping respond? Recently Biden had this to say in an interview.
The brutal economic truth! China’s real estate industry crushed the real economy, private investment confidence is facing a collapse, the development model of investment-driven economy has almost come to a head.
The real estate industry in China is crushing the real economy, and private investment confidence is collapsing.
The Chinese economy’s lead will be reversed as China’s progress towards “herd immunity” lags significantly behind that of Europe and the United States, coupled with the high level of household debt in China.
Xi Jinping is embarrassed! Li Keqiang strolls through Shanxi’s New Year’s Eve street without wearing a mask
On Feb. 7, Li Keqiang visited the New Year’s Eve market in Yuncheng, Shanxi province, without wearing a mask. The entourage he took with him and the local people around him did not wear masks, a scene that contrasts greatly with Xi Jinping’s visit to the New Year’s Eve supermarket in Guiyang a few days ago.
According to official media reports, on the morning of Feb. 7, Li Keqiang visited the New Year’s Eve market in Yuncheng, Shanxi Province, and shopped for two New Year’s Eve goods. Afterwards, the premier came to the Home of Fan Qishan, a Family living in poverty in Wu Village, Miaoqian Town, Xia County, and sent a copy of the New Year’s goods to Fan Qishan and asked him about his family’s income from farming and working outside the home.
The video posted by netizens shows that on February 7, Li Keqiang visited a New Year’s Eve market in Yuncheng, Shanxi province, without a mask. The entourage and the people gathered around him did not wear masks, and they all huddled together without regard for the safe distance, as if the virus was far away. Li Keqiang waved his hand and greeted the people gathered here.
Li Keqiang went to a stall selling New Year paintings and selected a large red “Fu” character. The stall owner said, “I wish you a happy Life and good health.” Li Keqiang asked the stall owner: “How much for one?” The stall owner replied, “We sell this for 5 yuan.” Li Keqiang said, “Here’s 10 yuan.” He took out 10 yuan from his jacket pocket and handed it to the vendor.
The netizen who signed “The Power of Silence” said, “Lord Zhongtang, no need to wear a mask, calm and relaxed, not to engage in a majestic atmosphere, walking the streets, normal people should be so ~”
Li Keqiang came to a vegetable stall and asked about the price of onions.
Comments from netizens.
“are making a show acting to fool the leeks, domestic news are the Communist Party wants you to hear, want you to know, do not want you to know never broadcast.”
“The big stage of life, there is always a red and white face it. As a prime minister pro-people image is not the main measure.”
“It’s all rehearsed, five versus ten is a rehearsed relationship, Lord Zhongtang took out money before he took out his pocket, he knew what he took out was ten.”
Biden interview says Xi Jinping has no democracy in his bones, fierce competition between U.S. and China
In an interview, President Joe Biden said the U.S. and China will experience “extreme competition” on the global economic stage, but believes they will not be involved in direct conflict such as war, as the future of U.S.-China relations remains unclear.
Biden said in an interview broadcast by CBS on Sunday (7) that there is no reason for the U.S. and China to get involved in a war, but there may be a conflict on the economic level in the next few years. He said the new administration would respond to China in a different way than the previous dynasty: “I will not act in the same way as former President Trump and will focus on international rules.”
The CBS anchor asked, “The U.S.-China relationship is probably one of the most important issues in the world. Why haven’t you called Xi Jinping?
Biden replied, “We haven’t had a chance to talk to him yet, and there’s no reason not to call him. People tell me I’ve probably spent more Time with Xi Jinping than any world leader, because I had 24 to 25 hours of personal meetings with him when I was vice president and traveled 17,000 miles with him. I know him very well.
He’s tough,” Biden said. But I’m not criticizing, just stating the reality that he’s not a bit democratic at heart,” he said.
“I’ve always said to him, we don’t have to clash. But the competition will be fierce.
Biden added: Xi Jinping is smart.
In his first major foreign policy speech in office last Thursday, Biden made clear that China is the U.S.’s toughest competitor, but is prepared to work with China when it is in its interest to do so. In response, the Chinese Foreign Ministry said the following day that it hoped the U.S. side would respond to the national sentiment of the two countries and the trend of the times, adopt a positive and constructive policy of dialogue, move in the same direction as the Chinese side, focus on cooperation and manage differences.
The cruel economic truth! Real estate crushes real economy, private investment confidence faces collapse
Big data expert “barbarian warrior” recently wrote an article pointing out that, unlike the Epidemic response model in which major countries such as Europe and the United States provide direct cash subsidies to their citizens, China’s economic model in 2020 is for the government to borrow money to invest and thus indirectly subsidize its citizens. The real estate industry is crushing the real economy and private investment confidence is facing a collapse.
Table 1: Fixed asset investment data from 2010 to 2020 (data source is the official website of the National Bureau of Statistics).
It is easy to see from Table 1: Fixed asset investment data from 2010 to 2020 that 2018 was the peak year for fixed asset investment in China and has been declining continuously since then. 2019 saw a sharp contraction of 13.2%, with secondary industry investment (also known as industrial investment) shrinking by a whopping 31.5%. 2020, against the backdrop of all sorts of strange and so-called new infrastructure investment concepts of hype In 2020, against the backdrop of all sorts of weird and wonderful so-called new infrastructure investment concepts, fixed investment still shrank by 5.9%, with secondary investment shrinking by 8.5%. Of course, the position of real estate investment is still solid, with an increase of 9.9% in 2019 and 7.0% in 2020.
After these two years, the scale of real estate investment and industrial investment has been very close to the scale of industrial investment is 97.8% higher than the scale of real estate investment in 2018, only 23.4% more in 2019, and then in 2020, only a mere 5.5% more! According to this trend, in 2021, the scale of real estate investment will overwhelm the scale of industrial investment.
Barbarian warriors analysis, 2020 popular moment of the new infrastructure concept, in fact, all are invested in a variety of industrial, such as data storage centers, 5G base stations, charging piles, etc.. At the same time, the financial system issued the strictest ever policy on the three red lines of real estate financing in an attempt to stop the flow of funds into the real estate development sector. Yet at the end of the day, when we look at the data, it is still property investment that steadily wins over industrial investment.
This means that the effect of the CCP’s real estate control policy in 2020 is worrying, and the real estate control policy will continue to increase in 2021.
China’s most profitable manufacturing category is the electronic equipment industry, according to the database of the National Bureau of Statistics, the average data of the industry is: the average size of the enterprise employs about 860 people, all the hard work and overtime to work hard on production, the annual input cost of 530 million, but only 28 million a year to earn back the profit. This is the average level of the industry.
With this 530 million to buy treasury bonds can have 25 million interest income, speculation in real estate is a minute 100 million to hand; if further, take to do real estate development, doubled are possible. Who will still engage in industry?
Table 2: Evolution of the relationship between debt and investment (data source is the official website of the central bank)
In 2018, China’s financing conversion rate reached a maximum of 2.83, which means that for every additional dollar of debt, there can be 2.83 yuan of investment in fixed assets, and this financing efficiency is actually quite good. After that, the marginal effect of debt-driven investment emerges. 2019, the financing conversion rate drops sharply to 2.15, and then in 2020, it drops directly to 1.49. For every dollar of debt added to society, only 1.49 yuan of investment can be added. That’s already scary. At this trend, the financing conversion rate in 2021 will probably drop to about 1.
This means that society as a whole simply won’t be able to get its own money to invest! Every penny of investment relies on debt growth.
Yang Xu, a commentator on Apollo.com, said the most frightening thing is that this means that private and foreign investors have no confidence in China’s economic outlook, and the investment-led economic development model has almost come to a head.
House prices plummet, Yanjiao owners “give away their houses” for nothing
A few days ago, the news of “free real estate in Yanjiao Tianyang City” was circulated on the internet and sparked a lot of discussion. The news was confirmed to be true by land media. The owner of the house said that he has already paid more than 400,000 yuan, and he will lose more if he pays off the loan. Experts point out that it should be common in China for properties to be insolvent, and this is just the tip of the iceberg that has been exposed as a precursor to the overall collapse of the Chinese economy from a larger perspective.
On January 12, a netizen named “thick earth” posted in the posting bar that he was willing to “give away the property of Tianyang City (there are still loans), first come first served, and pay back the loan by himself”, attracting many netizens to watch.
On January 26, “thick earth” posted again to say that the house is Tian Yang City 2 apartment building, bought in 16 years, 40 square meters, there are still more than 700,000 loans, is now considered unable to pay off the mortgage, but currently there is no break in payments, if you are willing to bear the transfer costs and return travel expenses, you can always do the procedure, usually do not log in to post, think about it directly plus WeChat. The first thing you need to do is to get a new one.
The “thick earth” said to the “New Beijing News”, the reason for the choice of free gift, the reason is “insolvency”. The house was bought as a wedding house, and he didn’t live in it much after the purchase. He left Yanjiao in 2017 to settle in Yunnan, so the house has been in a state of rent, the rent “is not worth more than 1,000 yuan per month.”
“The reason why he wants to give it away is not whether he can afford the monthly payments, but that he is losing more and more money, “I have taken in more than 400,000, and if I pay it back again, I will lose more.”
“Thick earth” frankly, “the current unit price of Tianyang City is only 17,000 or 18,000, this house is not paid off the loan, basically and the market price is equal. For the matter of accepting the gift and continuing to pay off the loan, it may not be suitable for those who are qualified to purchase a house; for those who are not qualified to purchase a house, it is still possible.”
It is reported that Yanjiao is located across the Chaobai River from Beijing’s Tongzhou and only 30 kilometers from downtown Beijing, carrying overflow residential demand from Beijing, with hundreds of thousands of commuters traveling between here and Beijing every day.
CREIS data shows that in the past five years, the Yanjiao property market has seen a sharp rise and fall. In 2016, when the property market was at its craziest, the annual volume of new homes in Yanjiao reached 17,282 units; in 2017, due to the restrictive purchase policy, the volume fell precipitously to 3,540 units, and in 2018, it reached a low point of only 987 units.
In terms of transaction price, it had reached a high of 30-40,000 yuan/square meter in 2017 and a low of only 11,863 yuan/square meter in 2018; it basically remained above and below 20,000 yuan/square meter in 2020.
China’s high household debt, economic leadership fears reversal
Recently, some strategists tried to find out the indicators of economic recovery by calculating in which Congress is the first to reach the “herd immunity” threshold. But foreign media estimate that, according to the current rate of vaccination, China will take five and a half years to achieve “herd immunity,” significantly slower than the United States and the United Kingdom, 11 months and 6 months, respectively.
If Western countries reach “herd immunity” earlier than China, it will be a major challenge to China’s economy if the blockade is lifted and countries in Europe and the US open up to each other one after another, which could reverse the current economic pattern. Louis Kuijs, an Asian economist at the Oxford Economics Institute, even said that if China does not speed up the vaccination process, it will affect economic growth in the coming years.
In particular, China has been “heavily indebted” in the last year to cope with the new pneumonia epidemic. According to the Bank for International Settlements (BIS), China’s household debt surged by about US$380 billion (about HK$2.96 trillion) in the first half of 2020, almost four times the rate of the United States, and China’s household debt to gross domestic product (GDP) ratio rose by 3.9 percentage points during the period, an increase greater than most countries.
French foreign trade bank also published a report, pointed out that China’s debt burden last year because of the epidemic last year and a sharp rise, even though the current savings rate and economic account surplus high so that China’s outbreak of debt crisis opportunities are not large, the economy to maintain growth can make the debt growth rate gradually return to normal, but to reduce the debt to GDP ratio requires more stringent fiscal constraints, and corporate and household financing should be more cautious.
The bank continued to point out that China is likely to be highly indebted for a long time to come, becoming a stumbling block to economic growth and inhibiting durable goods consumption and the business environment. High indebtedness will also limit the role of countercyclical measures in the face of unexpected economic shocks in the future.
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