The “unproductive production” fueling China’s GDP | IN 60 SECONDS

The “unproductive production” fueling China’s GDP | IN 60 SECONDS


A lot of people think China is taking over
the world. They think that because China has a big economy. And they’re said to be growing still pretty
fast, much faster than the U.S., two or three times faster. What’s missed there is what’s growing even
faster than China’s economy is China’s debt. Since 2008, the U.S. has borrowed a lot of
money, but China has borrowed about three times as much. We’re talking about $20 trillion or so. The worst performance in world history on
debt. You go one step down to the industry part,
China does have a very big industrial sector, probably biggest in the world, bigger than
the United States. And they’re saying it’s growing at 6% which
is a pretty fast clip. But what they don’t say is that rail freight,
which is how you’d carry a lot of the industrial production, is actually shrinking. They don’t say that port freight, which is
another way to carry industrial production, is growing only about half the speed of industrial
production. So one possibility is China is building a
lot of stuff. But it’s not going anywhere. It’s just sitting. It’s not being sold which means the companies
that build it aren’t making money. And guess what companies that don’t make money
have to do? They have to borrow. It gets us back to the debt. So is the bald guy right? Let me know in the comments section, and let
us know what other topics you want AEI scholars to cover in 60 seconds.

18 thoughts on “The “unproductive production” fueling China’s GDP | IN 60 SECONDS

  1. Chinas economy is a massive spin campaign.
    I was on a train in China, going from Beijing to Xian a year ago, and along the way there were big cities which were largely deserted. They built cities just to prop up the GDP, but no one wants to live there.
    A lot of people don't earn enough money to buy basic food anymore, and rely on family support.
    People retire really early just so they can get young people into the job market.
    The cost of housing there is now so insanely high, someone from America would have trouble affording an apartment. The only way most locals get housing is through government subsidy.

    At some point, China will hit a brick wall, and it wont be pretty when it happens.

  2. I really don't care about China debt. China foreign reserve was US$2.7 trillion in 2015, in 2016 they will jump back US$3 trillion to 2014 level. The debts are in yuan not USD. Debts are inside China, China don't own any country debts. Just like Fed, they manipulate the yuan out. Export and import is gonna be taking a smaller part of China GDP. It was written in their 13th 5 year plan. Domestic growth will take a higher percentage.

  3. I love these 60-second segments. I get to see a lot of topics that I would otherwise skip. A lot of longer videos aren't in the habit of providing an executive summary. So, there's a lot of longer content that you can't even tell if you care. But, a 60-second viewpoint, that is something that tells me whether on not I want to spend my time digging deeper. Thank you, and keep it up.

  4. No! China has biggest, best and the most fair economy in the whole world, and anyone who disagrees with it is a evil capitalist tool who does not understand the glory China under Mao Zedong and Xi JinPing! Glory to the First Born! For Aiur!

  5. All fake, you know why? China didn't borrow money it you USA borrowed tons of money and to,d us to pay it out. China is make tons of money today and China sells a lot of things. China's GDP is going to pass USA

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