That was a BBC TWO documentary presented by Robert Peston that highlighted how much of China's economic might during the 2008 global financial crisis was fuelled by domestic construction projects. With immense infrastructure projects like building more bridges, lots of high-speed rail, airports, military expansion, even brand new cities China mobilised the money it had to spur growth to unprecedented levels in global economy. It plan was nothing new, America did the same thing to get itself out of the great depression in the 1930s. They build roads, the Hoover dam and then World War 2 came along and really helped pull the US out of the depression by giving its citizens jobs fighting the war or making arms.
To a large extent China's growth spree in their country has slowed, but elsewhere in Southeast Asia, Africa and Sri Lanka, Chinese companies are making huge construction investments with borrowing from their government. In Malaysia the Chinese Railroad Company, Country Garden Holdings and Guangzhou R&F Properties caused a building spree and real estate speculation that continues to raise home prices beyond affordable reach of the middle-class.
China is now on the brink of a stock market crash. It seems it is because small investors are pulling their money out because of the big bear in its markets. So the governments is opening up its purses again to shore up its exchanges.
Just how much money does China actually have? Unlimited perhaps that it can continually shore up economic growth, take wild risks like creating ghost cities, building islands in the Spratlys or pumping money into unaccountable Third World nations. Economist have been predicting a crash to correct Chinese economy for a while now. If that happens it could possibly be a good thing for the environment. The price of oil will plummet further, there will be oversupply of construction material causing a drop in construction cost and real estate and there will be less incentive to destroy the environment for cash. It may be the respite we need to shift our consciousness towards environmental concerns. The Chinese government is rich and authoritarian, they literally believe they can do whatever they want, lets see if they still have a rabbit in their magic hat. The weeks and months to come will be crucial for the global economy. What China will not be able to hide right now is whether their economic growth since 2008 was spurred by real wealth surplus or simply by printing money like the rest of us could do with our printers, but cannot...if only we had a big stick!
One of the best articles I have read on the Chinese stock market crash, click here.
Expand your economic knowledge of our amazing world, comic style like the pix above check out this book–well worth your time!
To a large extent China's growth spree in their country has slowed, but elsewhere in Southeast Asia, Africa and Sri Lanka, Chinese companies are making huge construction investments with borrowing from their government. In Malaysia the Chinese Railroad Company, Country Garden Holdings and Guangzhou R&F Properties caused a building spree and real estate speculation that continues to raise home prices beyond affordable reach of the middle-class.
China is now on the brink of a stock market crash. It seems it is because small investors are pulling their money out because of the big bear in its markets. So the governments is opening up its purses again to shore up its exchanges.
Just how much money does China actually have? Unlimited perhaps that it can continually shore up economic growth, take wild risks like creating ghost cities, building islands in the Spratlys or pumping money into unaccountable Third World nations. Economist have been predicting a crash to correct Chinese economy for a while now. If that happens it could possibly be a good thing for the environment. The price of oil will plummet further, there will be oversupply of construction material causing a drop in construction cost and real estate and there will be less incentive to destroy the environment for cash. It may be the respite we need to shift our consciousness towards environmental concerns. The Chinese government is rich and authoritarian, they literally believe they can do whatever they want, lets see if they still have a rabbit in their magic hat. The weeks and months to come will be crucial for the global economy. What China will not be able to hide right now is whether their economic growth since 2008 was spurred by real wealth surplus or simply by printing money like the rest of us could do with our printers, but cannot...if only we had a big stick!
One of the best articles I have read on the Chinese stock market crash, click here.
Expand your economic knowledge of our amazing world, comic style like the pix above check out this book–well worth your time!
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