China Economy Nugget!!

Why China Can't Lure Tech Talent from Bloomberg View

"China won't be luring foreign tech talent any time soon. And its struggles hold a lesson for every other country hoping to become the Silicon Valley of the future: The competition for global talent will be won by countries that foster the culture of openness -- to new ideas and new people -- that defined the American tech business for decades before Trump."

The Consequences of Economic Contraction in China

China's Economy Is Past the Point of No Return (Gordon Chang) from the National Interest
"The economy is essentially moribund as there is not much that can stop the ongoing slide. A contraction is certain, and a severe adjustment downward—in common parlance, a crash—looks likely."

Chinese Stock Market Regulators: AWOL!

How Political Insiders Are Trashing China’s Stock Market from the Fiscal Times [of the UK]
“The widespread existence and ubiquitous importance of political connections in China’s stock markets suggests that to some degree, China’s stock markets have been regulated on a political connections-based regime, which may explain the poor performance of China’s stock markets,” the authors write in a paper published last week."

China: Entering the "Bust" Phase

China: It’s Worse Than You Think from Democracy Journal
"Now that China has had its private debt binge, it is entering its bust phase—and the global economy is in for a bumpy ride."

China's Economic Meltdown

The China Bubble Pops (Robert Samuelson) from Real Clear Politics
"... China faces two problems, says Scissors, that dampen economic growth: high debts and an aging and stagnant population. The older population will shrink the size of the labor force; fewer workers will crimp the economy's output. (Between 2015 and 2040, China's working-age population 15-to-64 will fall by about 14 percent, projects the U.S. Census Bureau. That's nearly 140 million people.)  Meanwhile, debt -- for households, businesses and government -- soared by $20 trillion in the past eight years, says Scissors."

China: A Return to the Ranks of Weak States?

Will 2016 Bring the Collapse of China’s Economy? (Gordon Chang) from the National Interest
"The severity of China’s economic problems—and the inability to implement long-term solutions—mean almost all geopolitical assumptions about tomorrow are wrong. Virtually everyone today sees China as a major power in the future. Yet the country’s extraordinary economic difficulties will result in a collapse or a long-term decline, and either outcome suggests China will return to the ranks of weak states. As an initial matter, China’s current situation is far worse than the official National Bureau of Statistics reports."
Economic collapse?  Answer: Probably.

The Forces Coalescing Against China

The Forces Awakening Against an Antagonistic China from the National Interest
" In an effort to augment its sovereignty claims over what it considers as its national “blue soil,” China has inadvertently encouraged a growing number of nations to coalesce against it."

The Grim Politics of the TPP

Myths and Realities of the Trans-Pacific Partnership from the National Interest
"One problem regarding the politics of free trade accords is that there are always winners and losers, even if the result is a net gain for a nation’s economy. The losers generally know who they are and mobilize in opposition, but who the winners will be tends to be less clear."
The politics of the TPP are tough.  In my view, the TPP is much more about the US retaining global economic advantages for the foreseeable future ... or surrendering really soon those advantages to the trade pact the Chinese were trying to organize around the Pacific rim, one that disadvantaged the US BIG TIME!  The US was facing a take-it-or-leave-it circumstance as the Chinese were closing in on securing their deal with most of the major countries in the Pacific, excluding the US.  The TPP has all the same players sans the Chinese.  Is the TPP a bad deal for US workers? Probably.  But it's nothing compared to how bad the Chinese deal would have been for US workers. -- Nuggetsman

TODAY'S BIG NUGGET: The Souring Between China and North Korea

He Shells, She Shells from The Economist [of London]
"The shooting has stopped, but China is fed up with its ally, North Korea. ...  Since Xi Jinping came to power three years ago, official communication between China and North Korea, its supposed ally, has slowed to a “trickle” as the relationship worsened over the North’s nuclear posturing and over Mr Kim’s mercurial petulance."

New Challenges to China's Economy

Stocks Fall Most in 4 Years as China Dread Sinks Global Markets from Bloomberg
"The week’s retreat from the riskiest assets picked up speed as data showing a gauge of China manufacturing at the lowest level in more than six years highlighted the challenges facing the nation’s economy."

The Cooling of the China-Russia Courtship

Friendship Between Putin and Xi Becomes Strained as Economies Falter from the New York Times
"Mr. Putin has enjoyed basking in the stature of Mr. Xi, who leads one of the world’s largest economies. But with the recent stock market turmoil in China and the slowest economic growth in a quarter-century, Beijing will be unable to provide the ballast that Mr. Putin has sought against economic sanctions imposed on Russia by Europe and the United States after its annexation of Crimea, not to mention plummeting oil prices worldwide."

TODAY'S BIG NUGGET: What's Really Been Driving the Chinese Economy

The Man Who Got China Right (Joe Nocera) from the New York Times
" The fast-growing Chinese economy was being sustained not just by its export prowess, but by a property bubble propelled by mountains of debt, and encouraged by the government as part of an infrastructure spending strategy designed to keep the economy humming. (According to the McKinsey Global Institute, China’s debt load today is an unfathomable $28 trillion.)"

China: Defying the Laws of Economics?

China taught lesson about economic laws from the Daily Telegraph [of the UK]
"China is being forced to learn the hard way what traditional practitioners of market-based economics have known all along – that you cannot buck the markets and that economic development never proceeds in a straight line. The belief that China’s own peculiar form of authoritarian, state-sponsored capitalism could somehow defy the usual laws of economics always did look deluded."

TODAY'S BIG NUGGET: China's Many Troubles Looking Forward

Why China will never be as rich as America (James Pethokoukis) from The Week
"... many economists don't believe China's self-reported stats — probably even less so given the country's current troubles. And experts aren't so sanguine about China's economic direction. China needs growth. Although it may be the second-largest national economy, it is still a poor nation. ... one study suggests Chinese productivity actually declined from 2008 through 2012. This is a terrible omen for the prospects of future Chinese growth."
This item came out before today's meltdown...

TODAY'S BIG NUGGET: Does Beijing Really Know How Markets Work?

Bungling Beijing’s Stock Markets (Paul Krugman) from the New York Times
"China is ruled by a party that calls itself Communist, but its economic reality is one of rapacious crony capitalism. And everyone has been assuming that the nation’s leaders are in on the joke, that they know better than to take their occasional socialist rhetoric seriously. Yet their zigzagging policies over the past few months have been worrying. Is it possible that after all these years Beijing still doesn’t get how this “markets” thing works?"

China's 'Soft Power' Binge: The Bill Coming Due

Currency Devaluation Shows the High Cost of China’s Soft Power (David Francis) from Foreign Policy Magazine
"Beijing has been spending hundreds of billions of dollars to buy friends and influence its neighbors. Weakening the value of the yuan shows that the bill is coming due -- and China may not be able to pay it."

China's Demographic Time Bomb -- Coming Sooner Then Expected

Coming Soon: China's Demographic Doomsday (Gordon Chang) from the National Interest
"The country’s population will peak in 2028 according to the UN’s “World Population Prospects: The 2015 Revision,” released at the end of July. China in its peak year will have 1.42 billion people. By the end of the century, the country will be just a smidgen over a billion—and very, very gray."

"Big Picture" Questions on China's Market Crash

The True Danger of China's Crash (Robert Samuelson) from the Washington Post
"China's spectacular stock crash poses three questions. First, what caused it? Next, will it harm the "real" economy of spending and hiring, inside China and beyond? And, finally, how will it affect China's Communist Party and its economic strategy?"

Why Democracies Dominate

America’s Edge over China from the National Interest
"The place to look for an answer to whether China really will become the globe’s most dominant power is not primarily in the economic or military realm. The more pertinent area of interest is China’s domestic political institutions, and they suggest that a more equivocal answer is warranted to the question of whether China will emerge as number one. ...  America’s institutions are its key competitive advantage in the coming contest with China."

China's Bubble Will Burst

Stand Back (Clive Crook) from Bloomberg 
"The fact that a lot of shares have been bought with borrowed money will worsen the impact on many households and put lenders at risk as well. The blow to confidence will be all the greater because the government has acted so conspicuously as a market cheerleader. That's why the bursting of the stock-market bubble could conceivably deflate the myth that what Beijing commands of the economy shall be so."