China’s economy has a reputation for being strong and prosperous, but according to a well-known Chinese television personality the country’s Gross Domestic Product is going in reverse.
Larry Lang, chair professor of Finance at the Chinese University of Hong Kong, said in a lecture that he didn’t think was being recorded that the Chinese regime is in a serious economic crisis—on the brink of bankruptcy.In his memorable formulation: every province in China is Greece.... Lang’s assessment that the regime is bankrupt was based on five conjectures.
Firstly, that the regime’s debt sits at about 36 trillion yuan (US$5.68 trillion). This calculation is arrived at by adding up Chinese local government debt (between 16 trillion and 19.5 trillion yuan, or US$2.5 trillion and US$3 trillion), and the debt owed by state-owned enterprises (another 16 trillion, he said). But with interest of two trillion per year, he thinks things will unravel quickly.Secondly, that the regime’s officially published inflation rate of 6.2 percent is fabricated. The real inflation rate is 16 percent, according to Lang.Thirdly, that there is serious excess capacity in the economy, and that private consumption is only 30 percent of economic activity. Lang said that beginning this July, the Purchasing Managers Index, a measure of the manufacturing industry, plunged to a new low of 50.7. This is an indication, in his view, that China’s economy is in recession.Fourthly, that the regime’s officially published GDP of 9 percent is also fabricated. According to Lang’s data, China’s GDP has decreased 10 percent. He said that the bloated figures come from the dramatic increase in infrastructure construction, including real estate development, railways, and highways each year (accounting for up to 70 percent of GDP in 2010).Fifthly, that taxes are too high. Last year, the taxes on Chinese businesses (including direct and indirect taxes) were at 70 percent of earnings. The individual tax rate sits at 81.6 percent, Lang said.....
Economic growth has all but stopped in Europe, statistics showed Tuesday. The stall comes just when Italy, Greece and other nations need growth to help them wriggle out of the chokehold of debt.
The European Union economy grew a paltry 0.2 percent in July, August and September compared with the three months before, the EU statistics agency said. That is the same growth rate as the previous quarter, and far slower than the 0.7 percent before that.
And the picture is probably even worse. The statistics did not include Italy and Greece, the two countries in the most debt trouble. And their debt crisis only got worse in October, the month after this snapshot was taken.
Besides lowering standards of living and hurting the job market in Europe, a recession would be bad news for the U.S., which sells 20 percent of its exports to Europe, and for Asia.
THE CRISIS IS CAUSED BY EUROPE'S SOVEREIGN DEBT CRISIS AND THE DEBT WAS NOT CAUSED BY BUSH TAX CUTS OR "UNFUNDED WARS".
THE DEBT CRISIS WAS CAUSED BY SOCIALIST PROGRAMS. AND RIDICULOUS CO2PHOBIC POLICIES THAT HAVE DRIVEN UP THE PRICE OF ENERGY.