If Santa Claus is Chinese, what can the US expect for Christmas this Year?

Watch more Capital Account @ http://www.youtube.com/CapitalAccount
http://twitter.com/laurenlyster
http://twitter.com/coveringdelta

It's the holidays and Santa Claus is coming to town but in what form? Yesterday, markets rallied and you had bond bigwig Bill Gross of Pimco tweeting: "today is a santa claus rally prepare for record cold winter solstice upon us, euroland will not go away, china lurks, US not an island." So there's the threat of Europe, concern about China, and the US susceptible to all these problems, not to mention it's own. Now the China US issue -- is a favorite for US politicians, too. They love to hammer China -- we've seen it in the GOP debates -- we've seen it in negative campaign ads. But our guest says china is not to blame for America's economic ills. Far from it -- she asks if Santa Claus is Chinese! She points out that US manufacturing declined before China became engaged in the global economy going from 53% of the economy in 1965 to 25% in the 1970's. Meanwhile, Americans she argues have been the biggest beneficiaries of Chinese labor and consumerism with us exports to china growing 468 percent over the last decade while to the rest of the world it's been 55 percent. But all this great growth aside, what has been the effect of China's rise on...well....China? After all, you can't have this type of growth without some malinvestment, and as we have covered on this show in the past, the chinese banking system, with its tremendous loan growth over the
years, is undoubtedly hiding plenty of malinvestment. No one knows just how high shadow inventories of things like real-estate and development projects is in China, but ghost cities and empty sky risers serve as an eery warning that even the world's economic darling and largest creditor nation in the world may not be immune from economic forces now gripping a world flooded with credit.

Category:

News & Politics

Tags:

• Capital Account
• Lauren Lyster
• Demetri Kofinas
• Ann Lee
• demos
• RT
• RTAmerica
• Markets
• Finance
• Economy
• China
• chinese banks
• loan growth
• shadow inventory
• growth
• GDP growth
• gross domestic product
• chinese century
• hard landing
• soft landing
• developing nation
• BRICS
• currency peg
• currency manipulator
• ghost cities
• Bill Gross

[tinemoslo]

What an incredible logic Ms Lee has. It's not a housing bubble, because people need houses, but it's possible that there is a problem with prices (evaluation). Obviously she thinks that there is no housing bubble in the US, because there are millions of homeless families.

And I thought the bubble means that assets are overvalued and when prices go down, it drags financial system into disaster as bank's assets diminish. How stupid of me.

[manuelroxas1892]

Unfortunately Monsanto is already attacking us trying to own up farms and crops

[celainea]

Ann Lee has good points but fails to connect economic theories w/real human experience. Science students graduated to find the only jobs which paid enough were in industries that exploited the Earth of its resources or people's fear of getting older & useless. Math students graduated to find only Wall Street paid enough, & all to pay off exploitative student loans dreamed up by previous math grads. As the occupied movement points out, we need a more human oriented system.

[LeClassics]

@Ariana321 nvm just read your profile. let it all out!

[LeClassics]

@Ariana321 just a tad racist

[Ariana321]

Santa can't be Chinese, Santa doesn't drive 35 under the speed limit with his blinker on!

[newsradiohead]

25:15 Haha! Shannon is a wizard!

[newsradiohead]

@mrzack888 You're exactly right. Those fancy new homes in China are mostly bought up by speculators who are trying to "flip" the houses for a profit. Sound familiar to anyone?

[newsradiohead]

27:05 Demetri, Demetri, Demetri, you and the rest of the "Capital Account" team are always welcome to the produce I grow. Unlike cash commodities, commodity futures, security futures, options, and forward contracts, securities, foreign futures and options and currencies, my tomatoes cannot be rehypothecated; they will always be here, safe, waiting for you. Let's show the world how to make a friendship-based economy work, and maybe bring some order to this global financial chaos. Happy Holidays!

[mstipich1]

Ban imports from China until they organize free elections?