China's real estate situation and of the Chinese economy in Latin America (Complete)

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network switch: China Real Estate Status and Latin America of the Chinese economy (on)
the National People's Congress, March 9 will be open , Finance Minister Jin said, we are the bad debts, bad debts before the four major banks, ah, call out to 1.4 trillion yuan, appropriated to the four major assets of the company. Now the company can not sell the four assets, the results also Ministry of Finance was called to resolve. I used to just like to tell you ah, the banks ultimately have to call people bad bear. the result of this is the first time he admitted, no way, bad debt can not be resolved.
1) corrupt volume flight models, the bank refused to responsible
Another thing, just want to report it. As you may know, Harbin ran out of a mountain, take one billion yuan. This is a great a thing in China, today told not his running, but because many people put money in the bank called him to pocket a. Bank of China and the Chinese People's Bank of consultation, the money does not make up make up? we all know the situation in the United States, I have this experience, I was in Europe, the results of my bank card, is the BOA (Bank of America, Bank of America) have lost the cash card, I do not know, two days later to know. to call to the bank and found that 3000 U.S. dollars a people to brush away. Results banks tell me, do not worry, we'll supply you the money, we went to investigate. This is America's credit, in fact, I have not lost, it is why banks have to pay? United States is one such requirement. billions of RMB in China after being swept away, put forward a reason for the Bank of China, said that fraud is an individual mountain, has nothing to do with our bank, you who save money, and who themselves. The result is a highly controversial, depositors, including the Bank of China, Harbin Expressway say you have credit, I save money to come to you, otherwise, who keep coming to you ah? Bank of China said no, because he personally change your money, not our bank steal you, is his personal fraud, so you have to sue, sue him. so many savers urgent, that we can not go to Canada, told him to, ah, the Chinese government can not find him, we where to find him ? Therefore, Bank of China, ah, it appeared that the credit problems. do encounter problems, they push. Why do you push it? said that the Bank of China branch in Harbin, and now banks under the contract system. We made only 60% of wages and another 40% until the end of hair. He took away A billion is equal to the wages of workers of our province for 40% of banks are not the only took. Heilongjiang Province, on the book profit of the Bank of China more than 4,000 million, the actual loss of the four more than a billion, the newly appointed president said ten million profit a year, it seems, 05 years is not profitable, because the earlier gave swept away, and would like to profit not a profit also. Therefore, the Chinese bank's credit it into question.
2) corrupt officials were arrested for new official conclusion is . I will report a message, I was watching TV the world, in Los Angeles. that there is a private entrepreneur in Lanzhou called ZHANG Guo-fang caught. the result he involved after that, Wang Jun, Lanzhou Municipal Committee, Mayor Zhang Yushun, the Deputy Mayor Yang River and other officials, including one for more than 70 arrested., the Central Government and the Gansu provincial government to send a new secretary to go. The new secretary called CHEN Baosheng, inaugural address, called satellite TV to broadcast here, just asked me to see it. how to say what he was, he said, promoted. mayor, secretary gave arrested. they wanted to unite, what things should we discuss, after a good discussion to tell. China has a lot of such things.
II Situation of Chinese Real Estate
1) China Real Estate
dangerous to me to Dallas, I feel a feature of the house here on the cheap. envy. I live in a friend's house more than 3,000 feet of the house and sold 20 million, in Los Angeles is something unimaginable. In Los Angeles, is 700 to 800 dollars a foot, 3,000-square-foot sold for more than 200 million, this is simply heaven ah. I'll come here to immigrate to buy the house. Los Angeles, I can not afford a house, just look here newspaper ads, a four thousand eight hundred hundred feet of the house, take away a tennis court, a swimming pool, and sold one hundred and fifty thousand, which is simply given away, ah, in Los Angeles two million can not buy. However, more than a house in Shanghai Los Angeles is also terrible. I have a friend in Shanghai who is a doctor, orthopedic spine doctors do, the business is profitable. He said that the house is sold well in Shanghai, a 3 room apartments selling for 50 million dollars. to invest to buy two. I had said to him, can not buy. He said, no, we are buying, not buying is a fool. he really back to the mainland to buy, but also lined up to buy. Later, in Shanghai for 3 months months to come back. then told me that he had to buy two sets, then a set back, that no rebate can not, because he found that they lied to him. He said that the time to buy a house when he was told he was not a house, to queue up. When he took the ticket to see when they said that he had business in the United States, soon to go back. The results have two people told him the house, to sell him. He said he could not let others put it Shanghai people look too stupid, he would personally see to. The results showed that there are people who bought the house, but unoccupied, it is very strange. was to buy a set, and the other a house down payment, do not the. two weeks ago like I said, Americans are a fool of. think about it, light a Shanghai bank loans of 1.9 trillion, how could the Chinese people to pay this price? In fact, Beijing, Shanghai, the house has more than New York and Los Angeles. Los Angeles, Hollywood was only 800 foot, Shanghai How many? twenty thousand yuan / Hasmy! it was an apartment, ah, ah, not independent of the house! so the house market is very dangerous, but the Chinese economy is like.
2) by selling the local government to maintain fiscal
China to promote economic, Zhu was speaking before a positive financial and economic issue of bonds. Chinese state-owned economy is definitely less efficient than the private economy. In this time of low efficiency, the effect is that more and more cost-effective poor, social development, slower and slower. In this case, less and less government revenue, the economy will stagnate. this time, the fiscal expansion, the central debt and more spending to reduce the local government had no money.
how to do it? Guangdong, Fujian and other places is more intelligent, started selling land. State land in public ownership system, there is no field to enter the circulation. Land is only valuable when called commodity trading, the Chinese state-owned land are that it does not transactions, which did not produce the price, so its circulation system, does not include the value of the land, mining value. In this case, the local government land sales, equivalent to generate additional revenue to make up for local governments.
Gansu, Shaanxi Province The Government said that we had every building roads, investment, and we find people contributions, taxes, the central government that we arbitrary charges, we drop a bad name. You see, Shanghai, Guangdong, land sales, land sales is a pens, are a few millions, tens of millions. The results of Gansu, Shaanxi also began to sell. sold to pay the money is not the central government, only to pay more taxes, mostly to the local government. Therefore, China's real estate is not central government support, but the local government must sell the land after the land sales revenue to maintain provincial, municipal and county level, the functioning of local government, so they did a performance. In this case, if I want to be mayor, My buddies do real estate, when, after both of us to communicate better, to sell his land, he made money, everyone will have their portion, where have the money, the benefits came out, better social municipal construction.
3) The forced relocation, forced to buy a house, and twice the people, exploit
not the same as in China with the United States. in the United States when the demolition, there are other houses can go to rent. In China, not to rent a house to live, After a large number of house demolition in particular, rural and urban are not rented a house for a living. In this case, and further forced relocatees to buy a house again. the original value of the land the house it, has no value, only to compensate for very little money . forces you to the suburbs to buy a house, mean that you suffered a secondary exploitation, and that the money rolling again, or flow to the hands, because the real estate resources are mainly in the hands or control. In this case, there is a small economy microcirculation, only one loop in the profits, is the government. local government to maintain expenditure, it must do so. So we see that real estate has been rising in China, including Shanghai government officials also say a few days ago, said Shanghai house prices can not fall, down to a problem.
4) car loan bad serious insider
China has just started to do a car loan, which is about Jin. Now has identified the number of bad auto loans off it? 100 billion yuan. very few people in China buying a car, now has 100 billion yuan of bad debts, bad ones. They were how to do it? after they bought the car, to sell to other provinces, the money loading pocket and left. disguised loans, no place to check to check, no such system in China, and no social security number, where to go and spend some money can change identity, who also could not find him, and the local regardless of the police, the village folks, give me twenty thousand dollars to see him. so, very strange very strange phenomenon. Chinese real estate market as a whole is such a lie.
1) just the mainland inflation Start
another, the mainland is likely to be inflationary. In fact, the mainland released a couple of days ago the information said that the basic raw materials up to 71%. However, China has just announced that we have 3.9% inflation, I do not understand that 71% of the basic raw materials prices, including ore, petroleum, iron ore have risen, you do have aluminum shell of the cup it, its price can not just up 4%, raw materials rose 71%, prices rose only 4%, you say, is unlikely to do. speak in mainland China, you can not be too sure. just like the mainland Bureau of Statistics, said some time ago, big little liar liar, big small rogue rogue said. You can not say that local government 40% of statistics are poor, your statistics are not accurate, we central statistical accuracy. really bad 40%? that 40% of the equivalent of one year the Chinese government's revenue ah. reveal a message, the news is his story, the local Government's GDP and GDP difference between the central government statistics, 40%. almost equal to the Chinese mainland government revenue a year, but released by the mainland government is not so much revenue, and only 3,000 billion. But the difference between 40% and poor 460000000000 . From this we can see that the Government's revenue in China, may spend more than it should be published. He said the mainland is almost equivalent to a year in revenue. lay the data often reveal their vulnerabilities, but this is their their say. So you know, China's fiscal revenue is much higher than its published information. This is the finance minister speaking their own words.
2) a characteristic of Latin American economies: in fact, speak to a fixed exchange rate
talk to, or back to the original topic, how about the Chinese economy? the best country in Latin America economies are Argentina, Brazil. Argentina's land area in Latin American countries is relatively large, the material is better. The country has a feature that the Asian financial crisis 99 years, including the Brazilian financial bankruptcy, has no effect on Argentina. Argentine came through, just like China. Asian financial crisis, South Korea down, Indonesia, Malaysia also fell, the Chinese somehow, very similar examples. Latin American countries 80 years ago the economy is bad, then, a new president took office in Argentina, called Carlos Menem, really understand the economy. He performs several policies: fixed exchange rate, as with mainland China, across the board, Argentina called the peso currency, all foreign assets after coming into pesos, U.S. dollars are not allowed to flow. As a result, foreign exchange reserves to increase rapidly. rate unification, under government control. adopt the same policy with the Deng Xiaoping reform, opening up, foreign investment, development foreign economy. economic growth quickly, up to 9.7%, the lowest 7%, China 9.3%. Argentina's economy really growing rapidly, foreign exchange reserves increased rapidly, the currency stable. monetary value is very stable, foreign investors find a good investment, a large investment. economic growth well the year 1999 in October, Argentine President Carlos Menem (Carlos Menem) was invited to the International Monetary Fund / World Bank annual meeting speech, another speaker was President Clinton. This is a performance reward Menem himself, is a symbol of the glory of Argentina. At that time, Brazil also collapsed, Chile also fell, and Mexico also fell, with only Argentina is NO. 1. with China's situation is similar.
However, just two years later, Argentina sank into a severe economic, social, political crisis, the magnitude of the broad, deep beyond the level most people expected to .2001 in December, the bank deposits frozen, IMF announced a freeze on aid, the economy minister Ricardo Carvalho (Domingo Cavallo) and President Fernando de la Rua (De la Rua) have resigned, the Afghan government announced a freeze on payment of foreign debt.
2002 年 1 6, Congress passed , bank deposits and government debt are forced by the provisions of the peso exchange rate of .2 11, the reopening of the foreign exchange market, the peso began to depreciate sharply, the Government thus plundered from the banks and private wealth. As the Government's large-scale violations of private property rights , private investment and production of power lost, the elite continued outflow of talent. Also, if the monetary authorities can not quickly rebuild reputation, strict financial constraints, had to suffer a lot of Argentines for decades will be very serious inflation is coming. just a few years, Argentina into a slump from the glory, from the pet into a pariah.
3) the characteristics of the two Latin American economies: Argentina foreign investment
was learning the Chinese government example, China has ruled out a large delegation to learn from their experiences. From the point of contrast between the two countries, Argentina, land area of nearly 2.78 million square kilometers, ranking the world's No. 8. .2000 quite rich natural resources, GDP was 285 billion U.S. dollars, Exports accounted for only 10.8% of total GDP, total imports accounted for 11.4% of GDP. the same period, China's exports, GDP, total imports were 25.9% and 23.2%. Natural resources and economies of scale from the point of view, Argentina is actually a big country, at least a potential great power. economy is so good of a country, by 2002 a problem. It takes the first policy is to attract foreign investment, to foreign-based fixed exchange rate then.
4 ) characteristics of the three Latin American economies: the proactive fiscal policy is the third
proactive fiscal policy. step by step with China is very similar. Why take the proactive fiscal it? to a certain level of economic growth, do not pull up, it to expand investment, it felt more foreign exchange reserves to invest heavily. but in the case law is not perfect, cause a problem. as long as with the Argentine officials related to him, to have food to eat, to eat meat, drink at least point Feiyou soup. This time, Argentina corruption appears. positive financial, that is, government investment, have talked about, when a large government investment is bound to suppress the private economy, the government has the power, powerful, how it is saying private economic competition?
On the other hand, low efficiency of government investment, which is several decades of history and the history of communism have proven to do. The results economy go down, tax revenue and able to come up, the government can not be maintained. It is more than government bonds issued , to pay his debts, to taxes, how do? Argentina to adopt policies, this policy is called Zhu Rongji to the school to go, what policy? is to increase the financial transactions tax, interest to pay tax, the stock must pay taxes and so on. mission others did not learn to Argentina, to learn this. The results came back, people have to pay tax interest on bank deposits, stocks also pay taxes. Thus, it seems that the tax increase, bank deposits and money to invest, but the state-owned economy a lot of force in there, the lack of space for the private economy, and this space is called state-owned economy to the pressing. we make money, not private investment, we are watching. In this case, the Government out raise the money stock. Argentine Government to use a variety of policy stimulus, raising the stock market. on the front for two years, the mainland stock up to 2400 points, up very high, resulting in a large number of transactions, the Government make transaction tax to maintain the Government.
To maintain the credibility of the monetary system and financial system stability, the Government must be strict financial constraints. opportunists in the government (state opportunism) and the interventionist hit countries, the fiscal deficit is always the biggest threat to monetary stability, because the inflation tax levied to cover the budget deficit is the government's practices. Argentina's history, in particular, shows this. not difficult to understand, if not control government spending, the deficit continued to grow, it is hard to believe the Government is determined to maintain the currency board system in good faith. If regular project with little or no surplus earnings, only the surplus through the capital project to provide reserves. To do this, of course, to ensure monetary stability and the stability of the financial system to prevent capital flight, but the key is to attract increasing foreign investment inflows. This urge the Government to the scale of total external debt and GDP, government revenue to maintain an appropriate ratio between to ensure the solvency of their own, after all, the solvency of the government from the international market, a prerequisite for continued funding.
Obviously, wise one hand, the Government should promote the liberalization reforms, improving the institutional framework supporting the economic development to stimulate domestic economic vitality, enhance the supply side from the total efficiency of the economy and strength, to increase revenue; the other hand try to reduce unnecessary government spending in order to avoid occurrence of fiscal deficits and growth. deficit growth is dangerous. in particular, to recognize that, with the expansion of fiscal spending to stimulate aggregate demand is unlikely to achieve long-term stable economic growth.
But in fact, A Government is indeed a root Court irresponsible government, bureaucratic and totalitarian as the main features of the regime, implemented by the government irresponsible irresponsible fiscal policy, on the one hand (mainly the high-tax) to destroy the foundation of economic growth, on the other hand led to the surge in the size of fiscal deficits and debt, and ultimately making the government unable to pay the debt, damage the currency board system and the stability of the financial system.
authority of the former IMF economist, Musa (Michael Mussa) has such a classic comment: irresponsible fiscal policy. For Argentina, this is an old sad story. In order to meet a wide range of political needs and pressures, Argentina (all levels) to form a government spending far more than tax revenues lasting trend. as long as borrow money to support the excessive spending, whether domestic or foreign, where it also credit it where the borrower. When further borrowing is no longer feasible or possible to resort to inflation and (or) public debt suspension and denial of the creditors. This is the reign of President Alfonsin happened, and in the super-inflation in 1990 reached its apex. the details slightly different but essentially identical, and this is after 50 years (resulting in a financial crisis in early times) the ongoing story. can be said that the management of financial matters, the Argentine government, like a chronic alcoholic who, once He no longer difficult to self-control, until the economic consequences caused by the equivalent of drunk. (unfortunately) in the past 10 years, this story happened again, and in scale than the previous highest
5) the characteristics of the four Latin American economies: inflation
the end, the economy or not. just like now, like China, the stock market also fell, the economy or the lack of domestic demand, how do? Government has a trick is inflation. inflation, the most simple, the government printing more money, a print money, no debt, and money has depreciated. did you have 100 million bank, one year after the devaluation of 20%, about 80 million left, In another year, another 20% devaluation, and the remaining 60 million less. banished for a few years, government debt is gone, you last generation hard-earned retirement money to only 30 million. Argentina's it. it currency expansion to what extent?
from 1967 to 1990, the Argentine government has implemented successive 8 economic stability in an attempt to strengthen the fiscal and monetary restraint, but were unsuccessful. This history clearly demonstrates the Government's predatory opportunism and how strongly motivated by an irresponsible government controlled the monetary and fiscal policy is what the danger. by expanding the money supply, the government without going through Congress (public) official recognition, can obtain large pen receipts make up the deficit; by hyperinflation, the government can easily write off the national debt.
from 1985 to 1990, Afghanistan accounted for seigniorage revenue total government revenue of about 54%, which in 1987 This indicator is as high as 86%. In 1987, this indicator is as high as 86%. It is in such crisis situations, in order to stabilize the currency and restore economic growth, the leadership of President Menem's government in April 1, 1991 implementation of the main purpose of initiatives to ensure that the money supply from its own political manipulation of the process, eliminate the possibility of government-created inflation, borrowing dollars in liquidity to support the currency's purchasing power and public trust, in essence, borrowed from the U.S. dollar or the Fed credibility.
from April 1991 to December 1998 before the devaluation of the Brazilian currency, the median inflation rate fell to 1 from 4-digit, 7.4% in 1993, dropped to 3.9% in 1994. monetary stability has improved the investment environment, foreign investment inflows, while the Argentine government to gradually lift its trade, investment and control of capital flows, the economy began a strong growth. From 1990 to 1993, cumulative real GDP growth of 28%. After the end of the initial recovery process, from 1993 to 1998 in the, GDP average annual growth rate remains as high as 4.4% Moreover, due to the impact of the Mexican currency crisis, real GDP in 1995 compared with 1994 levels, down 2.8%! the same period, the inflation rate remained at a lower level, which in 1996 CPI inflation rate was just over the previous year 0,1998 an increase of 0.9%. No doubt, a lot of dollar outflows from the banking system deposits, capital flight seriously, the corresponding shrinkage of the base currency. On the other hand, supply and the means to cope with the liquidity crisis, eliminating the need for devaluation is clearly conducive to supporting people's confidence.
experienced a short sharp recession after the end of 1995 Argentina's rapid economic growth resumed and continued the end of 1998. it is these brilliant results achieved in Argentina and glory. the same period, Argentina's export sector even better performance.
between 1991 and 1993, real average annual growth of 1.8% of total exports, GDP contribute little to the rapid growth. However, in 1994 and 1997, average annual growth rate of total exports 14.4%, higher than the other seven major Latin American countries overall performance of 11.1%, significantly stimulated the growth of the domestic economy. visible In the December 1998 devaluation of the Brazilian currency before did not exist (due to dollar peg caused) peso overvalued affecting export competitiveness.
retained some features of the Central Bank. This flexibility in face of asymmetric external shocks have played a positive role in buffering stress, although it will weaken the currency board system of trust. However, the central bank and commercial banking system contains large amounts of reserve assets in the national government bonds (mainly dollar-denominated debt), a serious danger is that once the government unable to pay the debt, the financial crisis inevitable, social and political crisis is the root cause of this. If the low-cost market to borrow money to meet their extravagant desires tool. However, this is not a market reform, supporting efforts to improve the institutional basis of economic development
Now the Chinese Government as well. Two years ago, is meeting in Texas, I told them, revaluation of the renminbi is not the opportunity to appreciate how much bad debt? them know that I can appreciate. I told them, you devaluation of 20% a year, people eat bitter, but there is one condition, you see the Russian reforms, such a big change, it is a social security system and health insurance the same, the people humble, but hungry, but they did not enjoy the right. Zhu Rongji took office, he did not cut the social security system, and how much money he saved? save two trillion a year. to cut health insurance also, about forty provinces billion. A total amount of money the city that year, six trillion cut costs, he felt that development of the economy. but people do not spend money when they retire, there is no money to see a doctor, social unrest came out, this is a big problem. Argentina's currency expansion, there are still social security system, inflation can not stand, and China now have inflation, but no social security system.
6) additional revenue the government privatization, abolition of social security and medical insurance, bad debts worse
so much, inflation is inevitable way to go. But I suggest that they want to solve social security. So the stock market took the liberty of state-owned shares of trouble, I say you are 7000 million people or 1.3 billion people an important matter? might as well put the more than ten trillion yuan pension fund money to do calculations. you get some money each year to the people of pensions, benefits the people, give them medical treatment have landed. inflation, the people is more difficult to eat, eat a pound before meat, and now eat one or two, at least to maintain, difficult to stage the degree of the past. Otherwise, the Chinese government's bad day to be exposed, should the people to bear, the rich run the U.S., Canada to go, no money people how to do it? people money pit you finish, do you still have to pit the second time it? this case, the Chinese government did have to do a preparatory work, is to ensure a minimum life of ordinary people.
However, the Chinese government does not do it to learn in Argentina, studying it to inflation. just released two days ago, the mainland this year to March by 3.9% inflation rate, I really do not believe it. last Dec. 71 they announced price hikes of raw materials %, 71% of how I would like to become a 3.9%? really too poor. They were speaking is 3.9%, and you do have to believe, this is our statistics. just like my last talk in Minnesota, Shandong Province, say, our GDP is to retain the information, did not dare to say more. Anyway, they are always justified, thick skinned, that they lie, they do not recognize, saying it was a deviation of the data. Communist unity everything is information, they are not unified. this is the case The.
look through the privatization of Argentina is how to increase government revenue, in April 1991 President Menem to the Parliament for approval, launched a bold currency board system. Although the IMF began to doubt this is , but still gives support. Unfortunately, Menem was hard to resist the political pressure, the system has become a tool for government low-cost loans.
implicit guarantee from the IMF, the U.S. dollar because the peso borrowing reputation, began the influx of international capital, mainly the U.S. dollar to buy Argentine government bonds. peso replaced by the central bank, the government is spending this wealth, how? This little part of the flow of foreign corporate finance market, there is not much to form the expenditure of government services (such as justice, public safety, education, infrastructure, etc.). Despite the support of many public works projects, but most of the money was turned into the salaries of public sector employees and social security expenditure.
compared to the private sector, public sector employment (traditionally high) to increase faster, higher wage rate, no doubt about productivity also lower. This is an Argentine feast, as long as his employment in the public sector or through other ways and the privilege system maintained close contact. foreign government once assigned to the hands of the beneficiaries, the majority being used to buy on a good imported goods, to travel abroad and investments in foreign hard currency assets. In this way, the Government, through the majority of foreign capital coming in and out through the flow of private channels. But another stream entered a new round of foreign investment and the government revenue derived from privatization as a supplement to maintain the domestic currency supply and demand and balance international payments. However, with continued and repeated the process, external debt continued to grow, the growth rate of government expenditure is far higher than the rate of economic growth. Menem president from the early 90s to take a number of useful reform measures, including reform and liberalization structural adjustment, most importantly, in April 1991 implementation of the