Tuesday, August 16, 2011
... where angels fear to tread.
Given China's good economic statistics (as reported, and when compared to the West) and its leaders' propensity of late to chastise our foolish economic policies, a short post about a visit to China by Niall Ferguson caught my eye:
... When the Western economies first tanked in 2008-09, China's communist rulers ordered the country's banks to lend, lend, lend. The biggest borrowers were property developers and local governments.This certainly sounds like a real estate bubble to me. When it inevitably pops, there will be no shortage of people who will blame "capitalism" for China's problems. I plan to bring up this parallel whenever appropriate, and I hope pro-capitalist economic commentators do the same.
With inflation above 6 percent and the stock market down, the new Chinese middle class has gotten in on the act. An unknowable proportion of these new apartments have been bought as investments by people who already own one or more. With new-property prices up about 20 percent in just two years, who can blame them?
Sound familiar? Yes, this looks a lot like a real-estate bubble -- with Chinese characteristics. As for debt problems, Chinese bank loans were 97 percent of GDP in 2008. Now they're at 120 percent.
Government control or "encouragement" of economic activity is not capitalism.
Here's my favorite from a list of "10 Things I've Never Heard a Successful Startup Founder Say:" "Our most effective marketing campaigns were the ones filled with buzzwords and non-specific claims." [bold added]
The second link above presents the following example of something else I always notice when sleazy marketers try it: "When a company claims to be 'innovative and disruptive' but then pitches an idea you've heard ten times in the past month, it reminds us that if you have to say it, it's probably untrue."
I like this humorous take on reverse Turing tests: "Captchas to Keep Idiots out of Comment Threads."