economics
Imported tag from Readwise
economics
According to government statistics, 27 percent of Chinese automobile manufacturers were unprofitable in May; at one point last year, the figure reached 32 percent. Overproduction throughout the economy has also depressed prices generally, causing inflation to hover near zero and the debt service ratio for the private nonfinancial sector—the ratio
... See moreZongyuan Zoe Liu • China’s Real Economic Crisis
China's Rising Debt Service Ratio and Its Implications for Economic Stability: China's debt service ratio, which measures the proportion of income that households and businesses use to service their debt, has been increasing in recent years. This rise raises concerns about economic stability, as higher debt burdens can lead to reduced consumer spending and increased default risks. Consequently, policymakers are under pressure to implement measures that balance economic growth with sustainable debt levels to avoid potential financial crises.
Global comparison: China’s industrial support is roughly twice as large as what’s typical in advanced economies, and its side effects on efficiency are correspondingly greater.
Michael Magoon • How Much Does China Subsidize Its Economy?
Too good to be true
Western companies had long been so enthralled by China’s huge markets and cheap labor that they missed some red flags. China invited and allowed foreign companies to build factories typically under a setup of joint ventures, which required investors to partner with Chinese companies. It may sound like a fair request – after
... See moreThe Econolog • China’s Chip Scheme
In addition, the US greatly restricts the supply of physicians by requiring that they undertake at least eight years of expensive post-secondary education and then an additional three to seven years of training in residency; in Europe, a medical degree can be obtained in six years. Furthermore, because of these stringent, perhaps overzealous,
... See moreJ.K. Lund • The Curse of Material Progress
local authorities have reduced the down payment required for purchasing a second home as part of efforts to eliminate excess inventory from the market and provide some support for housing prices. Given that housing accounts for about 70 percent of the assets of Chinese families and mortgages represent approximately 75 percent of household debt, any
... See moreZongyuan Zoe Liu • Why China Won’t Give Up on a Failing Economic Model
Table A24 World trade in commercial services by category, 2022 (Billion dollars and percentage) Value Share 2022 Exports Commercial services Goods-related services Transport Travel Other commercial services Imports Commercial services Goods-related services Transport Travel Other commercial services Note : For information on asymmetries, see the
... See moreWTO • World Trade Statistical Review 2023
The fact that a change in the relationship between savings and investment in one country must force an obverse change in the relationship between savings and investment in another country is a very important point.
Michael Pettis • The Great Rebalancing
The flow economy is dynamic; you can think of GDP accounts as the economy’s Profit and Loss (P&L) statement. It measures what we are doing, using metrics expressed in dollars per year like consumption, savings, investment, government spending, taxes, net exports, and GDP. Things expressed per unit of time measure speed, like miles per hour on your
... See moreDr. John Rutledge • How to Think About the Deficit, the National Debt, and Interest Rates
The first and largest dollar spike occurred in the mid-1980’s. From the 1970’s and into the early 1980’s, the U.S. dollar encountered serious devaluation and inflation, so Fed Chairman Paul Volcker hiked interest rates up to the double digits to stabilize the dollar and force inflation back down. This, however, made the real interest rate on the
... See more