Wednesday, January 19, 2011

China: The Mother Of All Black Swans

From Wikipedia
The Black Swan Theory or "Theory of Black Swan Events" was developed by Nassim Nicholas Taleb to explain:
  1. The disproportionate role of high-impact, hard to predict, and rare events that are beyond the realm of normal expectations in history, science, finance and technology
  2. The non-computability of the probability of the consequential rare events using scientific methods (owing to their very nature of small probabilities)
  3. The psychological biases that make people individually and collectively blind to uncertainty and unaware of the massive role of the rare event in historical affairs
Why is China still showing 6-8% GDP growth, even though their exports are down over 25%?


As I have been predicting for years, China is going to crash. They will eventually collapse under the weight of their own bad decisions.

Read the link above and then consider the following ideas:

China is a Socialist Oligarchy in which the Oligarchy pretends to play at Free Market Capitalism.

A Socialist Ponzi Scheme economy can not withstanding a contracting population, and yet China has persisted in it's one-child policy.

China does not protect intellectual property rights, which means that innovators do not stand to be paid for their innovation. The engine of any thriving world-class economy is the creative use of resources. If creativity is not rewarded, resources will not be used creatively, and the economy will collapse. China gets by by stealing the creative ideas of other people. Such a scheme can only last for so long before it is brought down. As the old adage says, Crime doesn't pay. There is no honor among thieves, and eventually the thieves of China will set upon each other.

China's one-child policy has resulted in a massive disappearing female population. In year 2000, the World Health Organization declared that there were over 100 million women missing from China's population. Where did those women go? They were aborted, abandoned to death in the streets, and/or outright murdered as punishment for their uselessness, as providers, in the traditional Chinese worldview.

What will happen when there is not enough women to breed the next generation of Chinese Socialist taxpayers?

What will happen when hundreds of millions of men watch as the Socialist Ponzi scheme collapses?

What will happen when hundreds of millions of men are unable to find women with whom to share their lives which are left otherwise meaningless by an economy in shambles?

Can you imagine an entire economy based on prison rape?

In my opinion, China's future is not one of growth. It is one of unmitigated disaster.

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