The Chinese Emperor
If you think the West has a demographic time bomb problem then wait until you see China’s. Its population fell by 2 million last year. On top of that the growth rate has been in fairly steady decline for 20 or so years now, and the property market is imploding.
The Chinese authorities response is to ban investors from selling shares, demand to sell is not removed by such a policy, the pressure just builds and builds.
China, it seems, is not quite the future we thought it was. Leave aside for a moment the massive issue, which has never been addressed, of whether you really can have capitalism in an undemocratic state, (Western countries do not lock up billionaires when they start having opinions). China is also facing increasing competition just at the time that much of the West is waking up to the dangers of relying too much on cheap Chinese production.
China is not going to collapse, at least I don’t think it will, but it is no longer the sure fire bet it used to be. It has its own problems, it has huge sectoral imbalances and it thinks it can manage them by diktat.
It is also really worrying to consider the extent to which the willingness to put up with the communist party running everything to its own advantage is based on a rapidly improving economy lifting millions out of poverty.
This is what passes for a social contract in China, but if the government fails to deliver its side of the deal, tens of millions of people will become very unhappy, very quickly. It will do them no good, dissent just means the party will crack down harder.
But for all its power and willingness to use it mercilessly, the Chinese government cannot make the economy grow faster all the time.
The Chinese Emperor has no clothes, and people are noticing.
Economics, trade and Brexit, not necessarily in that order but the dog always comes first.
By Jonty Bloom Media