Intergalactic levels of wasteful investment indicates that real Chinese GDP is quite a bit lower than that reported by the Agitprop Division of the Chicoms. Absolutely amazing. Half is wasted. Half! China is literally full of shit. Useless shit.
“Ghost cities” lined with empty apartment blocks, abandoned highways and mothballed steel mills sprawl across China’s landscape – the outcome of government stimulus measures and hyperactive construction that have generated $6.8tn in wasted investment since 2009, according to a report by government researchers.
In 2009 and 2013 alone, “ineffective investment” came to nearly half the total invested in the Chinese economy in those years, according to research by Xu Ce of the National Development and Reform Commission, the state planning agency, and Wang Yuan from the Academy of Macroeconomic Research, a former arm of the NDRC.
…The bulk of wasted investment went directly into industries such as steel and automobile production that received the most support from the government following the 2008 global crisis, according to the report.
Mr Xu and Ms Wang said ultra-loose monetary policy, little or no oversight over government investment plans and distorted incentive structures for officials were largely to blame for the waste.
Don’t forget this part:
Misallocation of capital and poor investment decisions are not the only explanation for the enormous waste in China’s economy. A significant portion of China’s post-crisis stimulus binge was simply stolen by Communist Party officials with direct responsibility for boosting growth through investment, according to separate estimates by Chinese and overseas economists.
There is more here, from the excellent Jamil Anderlini. As Arnold Kling would say, 祝你今天愉快…
- See more at: http://marginalrevolution.com/#sthash.W7IcZTpp.dpuf
Perhaps this explains why so many educated Chinese want the hell out. It makes it doubly stupid for the Middle Kingdom to be throwing it's (wildly inflated) weight around. Catch up with the US? Never. Ever. This Dynasty is more wobbly than it looks.
No comments:
Post a Comment