There is a definite trend now developing of India and China falling down here.
I posted an article a week ago about how growth and investment in India hit a brick wall.
If this is the info they're releasing, can you manage what we're not being told, and how bad the true state of affair is?
http://www.bloomberg.com/apps/news?pid=20601109&sid=a.HOnXuLvG3g&refer=home
Communists Can't Outspend Capitalists as China Contends With Jobless Rise
By William Mellor
May 11 (Bloomberg) -- Over bowls of chili tofu and mushrooms at a restaurant in Shenzhen in Chinaâs humid Pearl River Delta, Terence Yap says heâs not alarmed that U.S. investors drove his companyâs share price down 58 percent over the past year.
âWe are in the right business in the right place at the right time,â Yap, 38, says as he gestures toward a gray industrial landscape that disappears into a pollution-blurred horizon. His occupation: selling surveillance equipment to a Chinese government thatâs stepping up security spending as the economy slows, unemployment rises and the population grows restless. âWe are in the business of providing peace of mind,â he says.
Peace of mind is getting harder to find for Chinaâs leaders. Premier Wen Jiabao has pledged to ensure âsocial stabilityâ as the government estimates that as many as 30 million rural migrants -- those Chinese who work in factories or seek urban construction jobs -- may have no income.
âWe will launch intensive campaigns to ensure public security and maintain law and order,â Wen told the National Peopleâs Congress in Beijing on March 5. Chinaâs unemployment rate is about 9.4 percent, according to an estimate by the Chinese Academy of Social Sciences -- more than double the governmentâs March figure of 4.3 percent for the registered urban unemployed it officially tracks. Adding to the burden are a record 6 million Chinese college graduates who are entering the job market this year.
Jobs Jostle
Demand for work is so high that 5,000 students jostled at a Shanghai employment fair in March for 400 jobs available in the funeral industry. One woman with a management degree applied for a position as a morticianâs assistant to âmake up the faces of the dead,â state media reported. The attraction: It paid 4,000 yuan ($585) a month, equal to what she might have earned in an office job two years ago.
By global standards, China is growing at a brisk pace; its 9 percent expansion in 2008 made it the best performer among the 10 largest economies. Gross domestic product slumped to 6.1 percent in the first quarter of this year, still a world-beating rate as the global recession cut demand for Chinese-made goods. Even as the countryâs leaders assert themselves on the diplomatic stage, they are preoccupied with keeping a lid on popular discontent as the 20th anniversary of the crackdown on the democracy movement at Tiananmen Square draws near.
âSensitive Yearâ
âThis is a very sensitive year,â says Jimmy Lai, chief executive officer of Hong Kong-based Next Media Ltd., who was banned by the Chinese government from the mainland in 1994 after condemning Beijingâs leaders for crushing the democracy movement. âIf the economy implodes, the risk of instability is high.â Lai, 59, founder of Hong Kong-based clothing retailer Giordano International Ltd., was forced to sell his Giordano shares after China shut down mainland stores in retaliation for his criticism.
As the countryâs leaders fret about unrest at home, theyâve stepped up their rhetoric about the economic policies of trading partners in the west such as the U.S., where China has invested some $1.2 trillion, which includes $744 billion in U.S. Treasury bonds. âWe lent such huge amounts to the United States, and of course, weâre concerned about the security of our assets,â Wen said at a press conference in Beijing on March 13. âAnd to speak truthfully, I am a little bit worried.â
China now holds almost $2 trillion in foreign reserves. âThe Chinese Communist Party is now the worldâs most liquid financial institution,â says Andy Rothman, a Shanghai-based strategist at CLSA Ltd., the Asian brokerage unit of Credit Agricole SA.
Chinese Demands
Before the Group of 20 summit meetings in London in April, Chinese officials demanded that western nations strengthen bank supervision and shun protectionism. At the same time, China central bank Governor Zhou Xiaochuan proposed a new reserve currency to replace the dollar.
In London, China deployed its economic clout to win a pledge that the International Monetary Fund and World Bank would no longer be dominated by Western leadership in exchange for its $40 billion contribution to the IMFâs $1 trillion emergency fund. At the summit, Chinese President Hu Jintao also faced down a French demand to target specific tax havens, a move that may have placed Chinaâs two autonomous territories, Hong Kong and Macau, in danger of international sanctions. Instead, in a deal personally brokered by U.S. President Barack Obama, the G-20 agreed to language criticizing tax avoidance.
âChina Has Bouncedâ
The U.S. leaderâs attentiveness to Chinaâs views, which included his pledge to visit Beijing later this year, underscored the wary relationship between the two nations, according to Eswar Prasad, a senior fellow at the Washington- based Brookings Institution and a former China division director at the IMF.
âTheyâre jockeying for position,â Prasad says. âThe U.S. is still the most important economy in the world, but itâs by no means the dominant economy it once was.â
Jing Ulrich, Hong Kong-based head of China equities at JPMorgan Chase & Co., predicts that China, now the worldâs third-largest economy, will overtake the U.S. as No. 1 in 30 years. For now, investors say, China is helping propel a worldwide recovery with a 4 trillion-yuan stimulus program.
âChina has bounced, and I think itâs very important,â Barclays Plc President Robert Diamond said in an interview with Bloomberg News on April 15. âAs you look at the numbers -- credit creation, industrial production -- the stimulus is working there.â
Spending Power
On May 6, Chinaâs central bank said the economyâs performance in the first quarter was better than expected in a published monetary policy report. The bank didnât provide figures for the assertion.
Regardless of when or whether China becomes the worldâs biggest economy, the new realities of global financial power are already becoming clear, says Donald Straszheim, a former Merrill Lynch & Co. chief economist who runs Los Angeles-based Straszheim Global Advisors, a consulting firm for investors in China. âThe U.S. and China are the G-2,â he says.
To achieve the growth levels needed to expand its factories, clean up its environment and fund a promised social safety net, the government must unleash the spending power of 1.35 billion consumers. Domestic private consumption accounts for just 35 percent of Chinese GDP, about half the rate in the U.S., according to government figures.
âMy First Pickâ
In its new role, China is helping to lead the worldwide effort to reawaken consumer demand, upgrade infrastructure and put people back to work. The country announced its stimulus program in November and has cut interest rates five times since September, to 5.31 percent from 7.47 percent, to spur consumers to buy products and new homes. Chinaâs stimulus amounts to the equivalent of $585 billion, compared with the U.S. plan for $787 billion in spending.
The IMF expects Chinaâs economy to expand by 6.5 percent this year, compared with the governmentâs target of 8 percent growth. In contrast, the IMF estimates that the global economy may shrink by as much as 1.3 percent in 2009, with U.S. GDP falling by 2.8 percent.
Based on those forecasts, some investors see China as the best growth option this year.
âChinaâs my first pick,â says Mark Mobius, who oversees $20 billion of emerging-market assets in Singapore for San Mateo, California-based Templeton Asset Management Ltd. âStocks are cheap on a valuation basis, and Chinaâs big stimulus package plus lots of foreign reserves means high GDP growth.â
Currency Wrangle
The countryâs financial clout may quickly propel it back to strength, says Nicholas Lardy, a China specialist at the Washington-based Peterson Institute for International Economics. âChina is in a much better position than the U.S. or U.K. or most other advanced economies to come out of the crisis,â he says. âIt is going to emerge with a bigger global footprint than when it went into it.â
To boost the status of the yuan, which isnât convertible, the government has established accords with five nations -- including Argentina, Indonesia and Malaysia -- to let traded goods be paid for in the Chinese currency. The government has also resisted the Obama administrationâs call for the yuan to rise in value against the dollar to help spur U.S. exports.
âPresident Obama -- backed by the conclusions of a broad range of economists -- believes that China is manipulating its currency,â U.S. Treasury Secretary Timothy Geithner said in a written statement at his January confirmation hearing.
CONTINUED
I posted an article a week ago about how growth and investment in India hit a brick wall.
If this is the info they're releasing, can you manage what we're not being told, and how bad the true state of affair is?
http://www.bloomberg.com/apps/news?pid=20601109&sid=a.HOnXuLvG3g&refer=home
Communists Can't Outspend Capitalists as China Contends With Jobless Rise
By William Mellor
May 11 (Bloomberg) -- Over bowls of chili tofu and mushrooms at a restaurant in Shenzhen in Chinaâs humid Pearl River Delta, Terence Yap says heâs not alarmed that U.S. investors drove his companyâs share price down 58 percent over the past year.
âWe are in the right business in the right place at the right time,â Yap, 38, says as he gestures toward a gray industrial landscape that disappears into a pollution-blurred horizon. His occupation: selling surveillance equipment to a Chinese government thatâs stepping up security spending as the economy slows, unemployment rises and the population grows restless. âWe are in the business of providing peace of mind,â he says.
Peace of mind is getting harder to find for Chinaâs leaders. Premier Wen Jiabao has pledged to ensure âsocial stabilityâ as the government estimates that as many as 30 million rural migrants -- those Chinese who work in factories or seek urban construction jobs -- may have no income.
âWe will launch intensive campaigns to ensure public security and maintain law and order,â Wen told the National Peopleâs Congress in Beijing on March 5. Chinaâs unemployment rate is about 9.4 percent, according to an estimate by the Chinese Academy of Social Sciences -- more than double the governmentâs March figure of 4.3 percent for the registered urban unemployed it officially tracks. Adding to the burden are a record 6 million Chinese college graduates who are entering the job market this year.
Jobs Jostle
Demand for work is so high that 5,000 students jostled at a Shanghai employment fair in March for 400 jobs available in the funeral industry. One woman with a management degree applied for a position as a morticianâs assistant to âmake up the faces of the dead,â state media reported. The attraction: It paid 4,000 yuan ($585) a month, equal to what she might have earned in an office job two years ago.
By global standards, China is growing at a brisk pace; its 9 percent expansion in 2008 made it the best performer among the 10 largest economies. Gross domestic product slumped to 6.1 percent in the first quarter of this year, still a world-beating rate as the global recession cut demand for Chinese-made goods. Even as the countryâs leaders assert themselves on the diplomatic stage, they are preoccupied with keeping a lid on popular discontent as the 20th anniversary of the crackdown on the democracy movement at Tiananmen Square draws near.
âSensitive Yearâ
âThis is a very sensitive year,â says Jimmy Lai, chief executive officer of Hong Kong-based Next Media Ltd., who was banned by the Chinese government from the mainland in 1994 after condemning Beijingâs leaders for crushing the democracy movement. âIf the economy implodes, the risk of instability is high.â Lai, 59, founder of Hong Kong-based clothing retailer Giordano International Ltd., was forced to sell his Giordano shares after China shut down mainland stores in retaliation for his criticism.
As the countryâs leaders fret about unrest at home, theyâve stepped up their rhetoric about the economic policies of trading partners in the west such as the U.S., where China has invested some $1.2 trillion, which includes $744 billion in U.S. Treasury bonds. âWe lent such huge amounts to the United States, and of course, weâre concerned about the security of our assets,â Wen said at a press conference in Beijing on March 13. âAnd to speak truthfully, I am a little bit worried.â
China now holds almost $2 trillion in foreign reserves. âThe Chinese Communist Party is now the worldâs most liquid financial institution,â says Andy Rothman, a Shanghai-based strategist at CLSA Ltd., the Asian brokerage unit of Credit Agricole SA.
Chinese Demands
Before the Group of 20 summit meetings in London in April, Chinese officials demanded that western nations strengthen bank supervision and shun protectionism. At the same time, China central bank Governor Zhou Xiaochuan proposed a new reserve currency to replace the dollar.
In London, China deployed its economic clout to win a pledge that the International Monetary Fund and World Bank would no longer be dominated by Western leadership in exchange for its $40 billion contribution to the IMFâs $1 trillion emergency fund. At the summit, Chinese President Hu Jintao also faced down a French demand to target specific tax havens, a move that may have placed Chinaâs two autonomous territories, Hong Kong and Macau, in danger of international sanctions. Instead, in a deal personally brokered by U.S. President Barack Obama, the G-20 agreed to language criticizing tax avoidance.
âChina Has Bouncedâ
The U.S. leaderâs attentiveness to Chinaâs views, which included his pledge to visit Beijing later this year, underscored the wary relationship between the two nations, according to Eswar Prasad, a senior fellow at the Washington- based Brookings Institution and a former China division director at the IMF.
âTheyâre jockeying for position,â Prasad says. âThe U.S. is still the most important economy in the world, but itâs by no means the dominant economy it once was.â
Jing Ulrich, Hong Kong-based head of China equities at JPMorgan Chase & Co., predicts that China, now the worldâs third-largest economy, will overtake the U.S. as No. 1 in 30 years. For now, investors say, China is helping propel a worldwide recovery with a 4 trillion-yuan stimulus program.
âChina has bounced, and I think itâs very important,â Barclays Plc President Robert Diamond said in an interview with Bloomberg News on April 15. âAs you look at the numbers -- credit creation, industrial production -- the stimulus is working there.â
Spending Power
On May 6, Chinaâs central bank said the economyâs performance in the first quarter was better than expected in a published monetary policy report. The bank didnât provide figures for the assertion.
Regardless of when or whether China becomes the worldâs biggest economy, the new realities of global financial power are already becoming clear, says Donald Straszheim, a former Merrill Lynch & Co. chief economist who runs Los Angeles-based Straszheim Global Advisors, a consulting firm for investors in China. âThe U.S. and China are the G-2,â he says.
To achieve the growth levels needed to expand its factories, clean up its environment and fund a promised social safety net, the government must unleash the spending power of 1.35 billion consumers. Domestic private consumption accounts for just 35 percent of Chinese GDP, about half the rate in the U.S., according to government figures.
âMy First Pickâ
In its new role, China is helping to lead the worldwide effort to reawaken consumer demand, upgrade infrastructure and put people back to work. The country announced its stimulus program in November and has cut interest rates five times since September, to 5.31 percent from 7.47 percent, to spur consumers to buy products and new homes. Chinaâs stimulus amounts to the equivalent of $585 billion, compared with the U.S. plan for $787 billion in spending.
The IMF expects Chinaâs economy to expand by 6.5 percent this year, compared with the governmentâs target of 8 percent growth. In contrast, the IMF estimates that the global economy may shrink by as much as 1.3 percent in 2009, with U.S. GDP falling by 2.8 percent.
Based on those forecasts, some investors see China as the best growth option this year.
âChinaâs my first pick,â says Mark Mobius, who oversees $20 billion of emerging-market assets in Singapore for San Mateo, California-based Templeton Asset Management Ltd. âStocks are cheap on a valuation basis, and Chinaâs big stimulus package plus lots of foreign reserves means high GDP growth.â
Currency Wrangle
The countryâs financial clout may quickly propel it back to strength, says Nicholas Lardy, a China specialist at the Washington-based Peterson Institute for International Economics. âChina is in a much better position than the U.S. or U.K. or most other advanced economies to come out of the crisis,â he says. âIt is going to emerge with a bigger global footprint than when it went into it.â
To boost the status of the yuan, which isnât convertible, the government has established accords with five nations -- including Argentina, Indonesia and Malaysia -- to let traded goods be paid for in the Chinese currency. The government has also resisted the Obama administrationâs call for the yuan to rise in value against the dollar to help spur U.S. exports.
âPresident Obama -- backed by the conclusions of a broad range of economists -- believes that China is manipulating its currency,â U.S. Treasury Secretary Timothy Geithner said in a written statement at his January confirmation hearing.
CONTINUED