1/10

The latest IMF report on China was released yesterday and provides a lot of good information and intelligent insight on the Chinese economy. The IMF’s measure of China’s adjusted fiscal deficit (including estimated off-budget

1/9

China is aging so rapidly that it urgently needs to address the problem of a rapidly declining work force in a slowly declining population. To give an idea of relative population changes among the three most populous countries, today

2/9

are 4.3 Chinese for every American and 4.7 Chinese of working age (ages 15-64), while there is just over 1 Chinese for every Indian and 1.1 Chinese of working age.

By the end of the century, however, there are expected to be 2.5 Chinese for every American and...

3/9

just 2.4 Chinese of working age, while there will be 1.4 Indians for every Chinese and 1.5 Indians of working age. Over the rest of this century, in other words, while China’s population declines quite rapidly relative to that of the two other most populous countries, it...

4/9

also switches from having a much better dependency ratio than either to having a worse one than either, with far more of its dependents being the elderly rather than children. In effect its working age population will drop by half relative to those of the other two.

5/9

This is going to be a very tough problem to resolve, although to the extent China succeeds, it will be very useful as an example for other countries. I am not sure they are going about it the right way, however. Making seniors make better use of smart technology sounds...

1/10

This is a really tough problem to resolve, especially if the massive increase in inflows from the trade and financial accounts are sustained, as I expect they will be well into 2021.

Clearly the PBoC would like to see the RMB gradually...

2/10

strengthen. This would keep financial markets stable and promote rebalancing, but the RMB has already strengthened a lot, and this puts unwanted pressure on exporters and “international circulation”.

Although PBoC reserves have been flat, other state-controlled Chinese...

3/10

banks have bought large amounts of dollars, but this is expensive. If these banks have half a trillion dollars of exposure, for example, they are losing at least $15-17 billion annually on negative carry, plus another $20-30 billion just this year from the rise of the RMB.

4/10

Beijing seems also to be trying other measures to slow the rise. The regulators are relaxing capital controls on outflows. In mid October the PBoC cut to zero the reserve requirement ratio for banks doing FX forward trading. This requirement was created in 2018 to reduce...

5/10

downward pressure on the RMB. In late October it suspended the counter-cyclical factor in RMB fixing, which was introduced in 2017 also to reduce downward currency pressure. But in both cases while the RMB dropped a few pips on the news, it quickly resumed its upward climb.

1/16

It is a little frustrating to see the response many analysts had to the GDP growth data Chinese released today. These numbers aren’t especially good, and they certainly shouldn’t have been surprising. Back in April and May, when most

2/16

were projecting negative or barely positive GDP growth for China in 2020 (the OECD, for example, expected China’s GDP to contract by 3.7%), I insisted that GDP growth for 2020 would be positive, and probably between 2% and 3%.

Today, it was reported as 2.3%. How did...

3/16

I know? Because I knew that while most of the healthy sources of Chinese growth would contract (except for exports, which would expand given Beijing’s intense supply-side response to the impact of Covid-19), Beijing was going to respond to a significant...

4/16

worsening of the healthy parts of its economy by unleashing enough of the unhealthy, non-productive growth it has long tried to constrain – basically real estate and infrastructure investment – in order to achieve as much economic activity as it...

5/16

needed for domestic political ends.

And that’s exactly what happened. While GDP grew by 6.5% in the fourth quarter, even with substantial tailwinds its retail sales measure – a proxy for consumption – was only up 4.6%, and it was down 3.9% overall in 2020.

1/9

Good article. But while growing international criticism and rising trade tensions may have had some impact, as the article suggests, I don’t think they really explain the great reversal in BRI lending of the past few years.

2/9

As I have been writing since 2011, China’s development lending was always likely to follow the pattern of other countries when they first “went out” (e.g. the US in the 1920s, USSR in the 1950s, Japan in the late 1970s). Because of little historical...

3/9

knowledge and no previous experience, an early rapid rise in development lending would be driven mainly by underestimating risk and an overestimation of their own business "success" in making loans, and would of course be further supported by geopolitical ambitions.

4/9

This combination would inevitably lead to bad lending decisions, followed just as inevitably by debt restructuring, loan losses, and a contraction in development lending. In the 1920s, for example, the US set off quite explicitly and aggressively to displace England in...

5/9

Latin America, and American businesses and banks assumed they “understood” Latin America much better than the English did, in spite of the vast English experience there, but their early displacement of British lending only resulted in the huge loan losses of the 1930s.

1/11

An article worth thinking about: “As changes to the world structure accelerate, China’s rule is in sharp contrast with the turmoil in the West,” says Beijing.

I agree, but I draw a different conclusion. The world is certainly currently

2/11

through "a period of turbulent change", in Beijing’s words, and great structural adjustments, but usually when that happens, what matters in the long run is not how stable a system seems but rather how successfully political, economic and social institutions adjust to...

3/11

the new conditions. In the past these adjustments have almost always been messy, chaotic, and disheartening to most, but ultimately they were necessary even if we were unable to judge them so at the time.

I would argue that the world today is undergoing both a reversal...

4/11

and rejection of the current model of globalization and an urgent need for most countries in the world, including China, to initiate a major rebalancing of the way income and wealth (and ultimately political power) is distributed, but there are few if any historical...

5/11

precedents in which this level of restructuring and rebalancing have been neat or orderly.

Beijing's response, which is to do whatever it takes to maintain stability, may look good in the short term, as this strategy always does, but if it prevents the necessary...

There is a recent new word in Chinese that I think deserves introducing into the Western neoreactionary canon.

The word is 内卷 (nei-juan) which has been translated as "involution". Originally a Chinese phenomenon it increasingly applies anywhere there is modernity.

To capture the essence of what "involution" means it helps to picture a spiral in your mind. Our modern narrative says that as we progress technologically we should progress OUT of the spiral and have more free time to be capable of ever more amazing things...

But what if the progression of technology and society actually sends us WITHIN the spiral in an infinite number of ever-decreasing circles? What if we are walking DOWN the spiral staircase of progress rather than UP?

"Involution" in its original meaning has been used to describe agrarian societies and how their development actually leads to self-perpetuating processes that prevent change and progress rather than encourage it.

Increased food production has limited many civilisations and sent them into stagnancy rather than allowed them to grow. This stagnancy can continue for millennia in safe environments till threatened, other times it drives the civilisation into extinction from external threats.

#NEIOH

1. Beloved Ones!

We Have Important Matters To Discuss With You!  If You Believe This Is A Joke, You Should Leave Now. We Do Not Joke When It Comes To This Planet. AKATU Will Lighten Things To Cheer You. What We Share Now Will Inform You.

THREAD #Serbian #Orthodox #Church bishops start Conclave (#Sabor-Holy Assembly in #SPC parlance) to elect new #Patriarch, 3 months after previous died of #Covid. Election much more about politics than religion, mainly #Serbia #Kosovo relations but also #Russia Orthodox Church /2

2/ vs. #Ecumenical Patriarch of #Constantinople. Most of numerous traditional cleavages within SPC (Young Lions vs. Old Guards); Serbians vs. TransDrinians; ecumenicals vs. hardline Orthodox etc. will be irrelevant with only the split between Russian vs. Greek students, roughly/3

3/corresponding with main division: support for whatever "solution" President Vucic might propose to satisfy int'l demand to at least de facto recognize Kosovo vs. stubborn refusal to accept anything not in line with current Serbian constitution that says #KosovoJeSrbija. /4

4/Due to 3 decades of heavy politicking under 1 weak Patriarch (Pavle) & his insipid successor (Irinej), those who’d otherwise be God-obeying “good guys” are staunchly in Kosovo Status Quo camp, refusing any deal. Those bishops who were in bed with politicians & secret services/5

5/ now support “accommodation” with Kosovo. Voting system is peculiar: Conclave picks 3 eligible bishops (each needs to obtain simple majority of votes i.e. 23); names of top 3 are sealed & 1 is drawn. System was designed in Communist times to prevent manipulation. Both sides /6

Today the Plateau State Contributory Health Care Management Agency PLASCHEMA paid an advocacy/sensitization visit to the University community.

THREAD!

Vice Chancellor, Prof. Yohana Daniel Izam led management staff, principal officers and other staff of the University to receive the PLASCHEMA team in the 600 capacity University Auditorium

The VC told the gathering that the health of every member of the university community is of paramount importance to him. He therefore welcomed the idea of a Health Insurance scheme advocated by the agency

Director general of the Plateau State Contributory Health Care Management Agency, Dr Fabong Jemchang highlighted the benefits of health insurance to members of the University community saying it will end the out-of-pocket expenditure on HealthCare.

He said the Plateau state Contributory Health Care Management Agency is poised to strengthen health financing by pooling resources and through strategic purchasing mitigating high out-of-pocket expenditure