YEAR END LOOK:
After a four-year absolute deflation cycle with Chinese currency at an eight-year nonstop plunge in world value, and still failing, inflation has returned this year. Can it remain, though?
China is fueled by debt. 300% of income annually. This is not sustainable.
A housing bubble is not sustainable to show GNP at 6.7% which adjusted to real economics is actually down to 5%.
China has lost 1 trillion dollars of its reserves going backward trying to support unprofitable state-run organizations for stability at all cost.
Nonperforming loans at Chinese banks are soaring. The state wants to swap these bad never to repaid loans for stock. This is not a fix. They must be written off which will shock the world.
As the currency plunges with no end in sight and China fuels stability with massive debt the model is no longer sustainable. This creating a RUN out of CHINA at an alarming pace. As the factories come back into higher production the smog is now rising to record pollution toxic levels beating world setting records of the past.
XI is consolidating absolute power and returning to old tried and failed currency controls and other military tactics to stop the run of capital out of the nation which never works for any nation.
China past all the propaganda is in the final stage of a failed economy what we economists call an absolute DEATH SPIRAL.
The world is very nervous as last gasp economics typically distract the people with war and violence.
We will have to see but XI fighting to keep China’s head above water has a long way to go in his ten year head of everything as China’s dictator in effect.
Communism is a failed economic model.
Which in the end is the core issue?
Berny Dohrmann – Praying for My Many Chinese friends and business owners
PS: If the Chinese hiccup the global rally becomes a crash.— December 11, 2016