Baby bust: China’s looming demographic disaster

Link: https://www.spectator.co.uk/article/baby-bust-chinas-looming-demographic-disaster

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According to a new UN report, China’s population growth has collapsed by 94 per cent, from eight million a decade ago to just 480,000 last year. What’s particularly worrying for Chinese leaders is that this means a rapid reduction in the working population. The previous set of projected figures suggested that by the year 2100, China’s 15- to 64-year-old population would be 579 million. This has now been revised down to 378 million, a 35 per cent fall. If this prediction plays out, the implications for China – and the rest of the world – could be brutal.

Today, every 100 working-age Chinese need to support 20 retirees. If trends continue, by the turn of the next century, every 100 workers will have to support 120 retirees. This means China will have the largest drop in working-age population among any of the G20 economies by 2030, with more than 23 million fewer Chinese. In percentage terms, Japan and South Korea will shrink even faster – but they became rich before birth rates began plummeting.

Author(s): Rana Mitter

Publication Date: 6 Aug 2022

Publication Site: The Spectator UK

Visualizing the Coming Shift in Global Economic Power (2006-2036p)

Link: https://www.visualcapitalist.com/shifting-global-economic-power/

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China is expected to surpass the U.S. by the year 2030. A faster than expected recovery in the U.S. in 2021, and China’s struggles under the “Zero-COVID” policies have delayed the country taking the top spot by about two years.

China has maintained its positive GDP growth due to the stability provided by domestic demand. This has proven crucial in sustaining the country’s economic growth. China’s fiscal and economic policy had focused on this prior to the pandemic over fears of growing Western trade restrictions.

Author(s): Raul Amoros

Publication Date: 13 Jun 2022

Publication Site: Visual Capitalist

Animated Chart: China’s Aging Population (1950-2100)

Link: https://www.visualcapitalist.com/cp/chinas-aging-population-problem-1950-2100/

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The one-child policy defined China’s demographic transition for over three decades.

But to combat an aging population and declining birthrates, the government scrapped the policy for a new two-child policy in 2016. Despite this massive change, China still faces a growing demographic crisis.

The above animated population pyramid from James Eagle looks at the distribution of China’s population by age group since 1950, with projections up to the year 2100.

Author(s): James Eagle

Publication Date: 27 Dec 2021

Publication Site: Visual Capitalist

Dude, Where’s My Stuff

Link: https://am.jpmorgan.com/us/en/asset-management/institutional/insights/market-insights/eye-on-the-market/dude-where-is-my-stuff/

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COVID has disrupted supply chains in two major ways: surging demand for imported consumer goods in the West due to pandemic work from home trends and other home improvement spending, and a decline in workers required to maintain and operate these supply chains. The surge in US import demand has led to a sharp rise in eastbound freight rates (see charts for Shanghai->LA and Shanghai->Rotterdam). However, westbound freight rates have not risen nearly as much, leading to an odd and problematic phenomenon: incentives for container owners to move them back to China empty to accelerate receipt of eastbound freight rates, instead of waiting for containers to be refilled to earn westbound freight rates as well. This is illustrated in the fourth chart which shows departing containers from LA/LB: a lot of them started leaving empty once eastbound freight rates surged. This further exacerbates supply chain issues, since US goods (i.e., grains) that were supposed to depart US railcars and warehouses for export remain in place, occupying space that US imported goods were destined for. 

Author(s): Michael Cembalest, Chairman of Market and Investment Strategy

Publication Date: 27 Sept 2021

Publication Site: JP Morgan

British pension funds plough more cash into China

Link: https://finance.yahoo.com/news/british-pension-funds-plough-more-155119851.html

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British pension funds are ramping up their investment in Chinese companies despite growing tensions between the West and the Communist state.

According to a new report by Hong Kong Watch, a pro-democracy advocacy group, the amount of cash invested by Western pension funds and other institutional investors in China has hit a record high in recent months.

It comes amid rising criticism in the West about China’s human rights record, including its brutal treatment of Uighur Muslims and its suppression of democracy campaigners in Hong Kong.

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The report cites the Universities Superannuation Scheme (USS), one of the UK’s largest private pension schemes, and Legal & General, Britain’s biggest pensions manager, as two British firms with “problematic” investments in China.

It found that L&G’s China fund was previously investing UK pensions in Zhejiang Dahua Technology, which is alleged to produce facial recognition software for the Communist Party that detects the race of individuals and alerts the police when it identifies Uighur Muslims.

L&G has since divested from Zhejiang Dahua Technology.

Author(s): Simon Foy

Publication Date: 22 Sept 2021

Publication Site: Yahoo Finance

Huge Credit Stress Starting in China May Easily Rock the Whole World

Link: https://mishtalk.com/economics/huge-credit-stress-starting-in-china-may-easily-rock-the-whole-world

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If funding stress signs don’t emerge, don’t conclude that there is no contagion. Contagion is playing out already if you know where to look.”

The mess in China does not stop with Evergrande. 

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Everglade shows the theft of wealth and money in a giant Ponzi scheme, not to be confused with real savings (i.e. net tangible assets at true market value)!

There is no savings glut. 

The alleged savings glut is nothing but a fiat Ponzi scheme where central banks have to keep money supply soaring to keep asset prices (based on debt) from imploding!

How much longer this setup can continue before it blows up in a currency crisis, war with China, or some other major economic disruption remains a key mystery.

Author(s): Mike Shedlock

Publication Date: 20 Sept 2021

Publication Site: MishTalk

How Beijing’s Debt Clampdown Shook the Foundation of a Real-Estate Colossus

Link: https://www.wsj.com/articles/how-beijings-debt-clampdown-shook-the-foundation-of-a-real-estate-colossus-11631957400

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The party has ended. Years of aggressive borrowing have collided with Beijing’s crackdown on debt, leaving the developer on the brink of collapse. Construction of Evergrande’s projects in many cities has stopped. The company has faced a litany of complaints and protests from suppliers, small investors and home buyers who sank their savings into properties the company promised to deliver.

Cash is so short that this summer, the developer said it began paying bills to contractors and suppliers with unfinished apartments instead of actual money. A paint supplier based in the southeastern province of Fujian said Evergrande recently paid off the equivalent of $34 million in bills with three unfinished properties, which the supplier is trying to sell. At a construction firm in Wuhan, more than 200 employees have been forced to take pay cuts because some of Evergrande’s bills are past due, a manager at the firm said,

Former and current employees say layoffs are adding up, and free meals that Evergrande used to provide for staffers at its headquarters have been canceled. In central China’s Hubei province, Evergrande has asked the local government to take over homeowners’ funds held in escrow accounts so they can’t be seized in legal disputes with creditors, according to people familiar with the matter.

Evergrande didn’t respond to requests for comment. The company said on Sept. 14 that its apartment sales have slowed markedly since June, its asset-disposal plans haven’t materialized, and it has hired financial advisers — a move that brings it closer to a potential debt restructuring.

Author(s): Xie Yu and Elaine Yu

Publication Date: 18 Sept 2021

Publication Site: WSJ

China Property Fear Spreads Beyond Evergrande, Roiling Markets

Link: https://finance.yahoo.com/news/hong-kong-stocks-sink-evergrande-023055601.html

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Growing investor angst about China’s real estate crackdown rippled through markets on Monday, adding pressure on Xi Jinping’s government to prevent financial contagion from destabilizing the world’s second-largest economy.

Hong Kong real estate giants including Henderson Land Development Co. suffered the biggest selloff in more than a year as traders speculated China will extend its property clampdown to the financial hub. Intensifying concerns about China Evergrande Group’s debt crisis dragged down everything from bank stocks to Ping An Insurance Group Co. and high-yield dollar bonds. One little-known Chinese property developer plunged 87% before shares were halted.

Hong Kong’s benchmark Hang Seng Index slumped 3.3%, its biggest loss since late July. The selling also spilled over into the Hong Kong dollar, offshore yuan and S&P 500 Index futures. Holiday closures in much of Asia may have exacerbated the volatility, traders said.

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“The repercussions from Evergrande’s prospective collapse will likely contribute to China’s ongoing economic deceleration, which in turn anchors global growth and inflation, and casts a pall over commodity prices,” wrote analysts led by Phoenix Kalen, head of emerging-market strategy in London.

Author(s): Catherine Ngai and Ishika Mookerjee

Publication Date: 20 September 2021

Publication Site: Yahoo Finance

Let’s Review 50 Years of Dire Climate Forecasts and What Actually Happened

Link: https://mishtalk.com/economics/lets-review-50-years-of-dire-climate-forecasts-and-what-actually-happened

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1970 Boston Globe: Scientist Predicts New Ice Age by 21st Century said James P. Lodge, a scientist at the National Center for Atmospheric Research.
1971 Washington Post: Disastrous New Ice Age Coming says S.I. Rasool at NASA.
1972 Brown University Letter to President Nixon: Warning on Global Cooling
1974 The Guardian: Space Satellites Show Ice Age Coming Fast

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1989 Salon: New York City’s West Side Highway underwater by 2019 said Jim Hansen the scientist who lectured Congress in 1988 about the greenhouse effect.
2000 The Independent: “Snowfalls are a thing of the past. Our children will not know what snow is,” says senior climate researcher.
2004 The Guardian: The Pentagon Tells Bush Climate Change Will Destroy Us. “Britain will be Siberian in less than 20 years,” the Pentagon told Bush.

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2013 The Guardian: US Navy Predicts Ice Free Arctic by 2016. “The US Navy’s department of Oceanography uses complex modeling to makes its forecast more accurate than others.
2014 John Kerry: “We have 500 days to Avoid Climate Chaos” discussed Sec of State John Kerry and French Foreign Minister Laurent Fabious at a joint meeting.

Author(s): Mike Shedlock

Publication Date: 18 February 2021

Publication Site: Mish Talk

China’s Corporate Crackdown Adds to Junk-Bond Distress

Link: https://www.wsj.com/articles/chinas-corporate-crackdown-adds-to-junk-bond-distress-11629019801?mod=e2tw

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The latest Chinese market to buckle under pressure from Beijing’s wide-ranging corporate crackdown: junk bonds.

Companies from China make up the bulk of Asia’s roughly $300 billion high-yield dollar bond market, thanks to a surge in borrowing by the country’s heavily indebted property developers.

But the investor optimism that drove that borrowing has collapsed.

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The widening regulatory crackdown that sparked a big selloff last month in the shares of internet-technology and education companies has also weighed on Chinese credit markets, pushing down prices of even investment-grade bonds.

The moves show China is getting more serious about reining in companies whose business practices are seen at odds with national priorities. Investors are now actively looking for sectors that might be next in the crosshairs.

Author(s): Serena Ng

Publication Date: 15 August 2021

Publication Site: Wall Street Journal

New York Times quashed COVID origins inquiry

Link: https://spectatorworld.com/topic/new-york-times-quashed-covid-origins-inquiry/

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Atop editor at the New York Times instructed Times staffers not to investigate the origins of COVID-19, two Times employees confirmed today.

‘In early 2020,’ a veteran Times employee tells me, ‘I suggested to a senior editor at the paper that we investigate the origins of COVID-19. I was told it was dangerous to run a piece about the origins of the coronavirus. There was resistance to running anything that could suggest that [COVID-19 was manmade or had leaked accidentally from a lab].’

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In November 2019, it emerged that China Daily had failed to disclose to federal authorities millions of dollars in payments to US outlets including the Times and the Washington Post. In August 2020, the Times quietly scrubbed the China-funded advertorials from its website. Still, in October 2020, the Times ran an op-ed by Regina Ip, a member of Hong Kong’s Executive Council, justifying the repression of anti-government protests in the Hong Kong SAR.

Author(s): Dominic Green

Publication Date: 2 August 2021

Publication Site: The Spectator

More evidence suggests COVID-19 was in US by Christmas 2019

Link: https://tucson.com/news/national/more-evidence-suggests-covid-19-was-in-us-by-christmas-2019/article_2235808e-a75b-55dd-aaeb-6a17877d03d8.html?utm_campaign=snd-autopilot&utm_medium=social&utm_source=twitter_

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NEW YORK (AP) — A new analysis of blood samples from 24,000 Americans taken early last year is the latest and largest study to suggest that the new coronavirus popped up in the U.S. in December 2019 — weeks before cases were first recognized by health officials.

The analysis is not definitive, and some experts remain skeptical, but federal health officials are increasingly accepting a timeline in which small numbers of COVID-19 infections may have occurred in the U.S. before the world ever became aware of a dangerous new virus erupting in China.

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The pandemic coronavirus emerged in Wuhan, China in late 2019. Officially, the first U.S. infection to be identified was a traveler — a Washington state man who returned from Wuhan on Jan. 15 and sought help at a clinic on Jan. 19.

CDC officials initially said the spark that started the U.S. outbreak arrived during a three-week window from mid-January to early February. But research since then — including some done by the CDC — has suggested a small number of infections occurred earlier. 

Author(s): Mike Stobbe

Publication Date: 15 June 2021

Publication Site: Tuscon.com, from AP