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China is a basket case....

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  1. #31
    Mamba

    In terms of personal debt people are sitting on a powder keg.

    You look around and yes there's a lot of wealth from the middle to top end but when you see people you know are earning less than 5000RMB a month driving a new car, buying a new flat or even a second flat to rent out, travelling two or three times a year and shopping every weekend you know there's something off.

    I've had people say to my face "hahaha, Westerners spend money, Chinese save it" then pull out a credit card to stick a coffee on it.

    As someone who watched the unchecked rise of personal debt and credit cards happen in the UK in the era of free money people went mental.

    Before we left the UK permanently in 2006 we had a big send off dinner with a group of friends. Talk got to oh you're so lucky leaving, then to oh I can't afford to leave, to people admitting how much debt they were in.

    Every single person around that table was between 35,000 and 250,000 POUNDS in debt. Not mortgages. Credit cards.

    The scary thing is that they had thought nothing of it as they racked up that debt.

    That's what's been happening in China for at least the last four years..

    Free play money gifted from the banks. When the bubble bursts it will be very, very messy.

    Last edited by Mamba; 20-05-2016 at 08:13 AM.

  2. #32

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    Quote Originally Posted by Mamba:
    In terms of personal debt people are sitting on a powder keg.

    You look around and yes there's a lot of wealth from the middle to top end but when you see people you know are earning less than 5000RMB a month driving a new car, buying a new flat or even a second flat to rent out, travelling two or three times a year and shopping every weekend you know there's something off.

    I've had people say to my face "hahaha, Westerners spend money, Chinese save it" then pull out a credit card to stick a coffee on it.

    As someone who watched the unchecked rise of personal debt and credit cards happen in the UK in the era of free money people went mental.

    Before we left the UK permanently in 2006 we had a big send off dinner with a group of friends. Talk got to oh you're so lucky leaving, then to oh I can't afford to leave, to people admitting how much debt they were in.

    Every single person around that table was between 35,000 and 250,000 POUNDS in debt. Not mortgages. Credit cards.

    The scary thing is that they had thought nothing of it as they racked up that debt.

    That's what's been happening in China for at least the last four years..

    Free play money gifted from the banks. When the bubble bursts it will be very, very messy.
    I didn't realize the Chinese people had so much personal debt, I thought most of the debt issues were at the government level.

  3. #33

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    Quote Originally Posted by Open Casket:
    I didn't realize the Chinese people had so much personal debt, I thought most of the debt issues were at the government level.
    Most is at corporate level I thought.

  4. #34
    Mamba

    I can only tell you what I've seen and what I've seen is a hell of a lot of people living way beyond their means.

    The debt bubble hasn't burst in the UK, it's the new norm.

    Statistics Archive | The Money Charity

    http://www.telegraph.co.uk/business/...ight-says-obr/

    Last edited by Mamba; 20-05-2016 at 09:04 AM. Reason: Add article

  5. #35
    Mamba
    I guess the appropriate response is "the plural of anecdote is not data".


    Absolutely agreed.

    My grandfather always told us to "smell the wind" see which way it was blowing and what it was bringing with it.

    I smell a global shit storm.
    Open Casket likes this.

  6. #36

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    Quote Originally Posted by hullexile:
    Most is at corporate level I thought.
    Define corporate in China? You have government owned banks loaning money to government owned corporations. Having the borrower and lender essentially one in the same. This is the ultimate ponzi scheme and it is going to blow up at some point...
    hullexile likes this.

  7. #37

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    Quote Originally Posted by Mamba:
    [/SIZE]

    Absolutely agreed.

    My grandfather always told us to "smell the wind" see which way it was blowing and what it was bringing with it.

    I smell a global shit storm.
    Agreed, but how to prepare for it? Buy land, farming equipment, seed and a shitload of firearms?

  8. #38
    Mamba
    Agreed, but how to prepare for it? Buy land, farming equipment, seed and a shitload of firearms?
    Go the full zombie apocalypse route? I'm not sure. I have a good friend here in HK who is a proper prepper, some of the stuff he's doing makes sense, some doesn't, I mean really doesn't.

    Guess when it comes down to it buying land only makes sense if you can get to it. Alright having a plan to go to the Winchester but how do you get there from here? If your bolt hole is on the other side of the world, that's a lot of garden walls to hop.

  9. #39

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    Original Post Deleted
    When I see figures like this I am always skeptical, China has such a large population still living in rural villages that I wonder how much this skews the debt numbers. It would be better to look at debt levels in the large cities and provinces like Shanghai, Beijing, Guangdong, etc. The numbers for China as a whole, at least in my opinion, don't provide a real insight into what is really happening with debt in China.

    Based on my experiences I have been seeing much of what @Mamba has, low salary workers making large or expensive purchases on credit.
    Open Casket and East_coast like this.

  10. #40

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    Quote Originally Posted by Skierx:
    When I see figures like this I am always skeptical, China has such a large population still living in rural villages that I wonder how much this skews the debt numbers. It would be better to look at debt levels in the large cities and provinces like Shanghai, Beijing, Guangdong, etc. The numbers for China as a whole, at least in my opinion, don't provide a real insight into what is really happening with debt in China.

    Based on my experiences I have been seeing much of what @Mamba has, low salary workers making large or expensive purchases on credit.
    This is a very good point and matches my obsevations as well. The many Chinese are still unable to rack up debt (no access to credit) so that likely does skew the per capita debt figures. Those is tier one cities are likely no better than people in the west and perhaps even worse in regards to managing debt.

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