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Here Are The 2 Most Important Variables For Forecasting The Global Economy
Via Kevin Muir of “The Macro Tourist” fame
I know everything is fan-freaking-tastic - with the tax reform bill and global synchronized expansion and all. I figure the last thing you need is some nattering naysayer throwing cold water on this unbelievable party, so I won’t. At least not for the short run. This rally will end when it ends. Maybe tomorrow, maybe next week, maybe next month, maybe next year. I don’t know and every time I try to guess, I just end up looking foolish.
But I
China has a dollar problem and a capital flight problem. They will actually export massive deflation.
China’s Communism is as about as much capitalistic as the US’s capitalism is socialistic. A lot.
China’s move away from a purer form of communistic (there never has been a pure communistic society) socialism toward a more capitalistic economy has fueled its amazing rise as a world class economy and nation. The rising and newer leaders in China are not stupid and are surely not blind to the impacts its more capitalistic economy has had on moving China forward. One inherent and primary character of the Chinese entrepreneur is the rapid recognition and adoption of what works in business. They may attempt to “save face” and deny their changes, but the reality will be and is obvious.
While I’m sure it’s still dangerous to say much about the inefficiency of communism (as in – it does not work at all economically) in China’s former experiments with Mao’s version of communism has to be an embarrassment to younger generations of leadership, a heavy cross to bear. China’s communism is something that will be even further put aside and buried in China’s future history and economy just as soon as enough of the “old guard communist ideologues” have passed. China’s state control private property and or capitalistic enterprise is a vanishing influence in the success of China’s more and more private based economy.
That passing of the “old guard communist” is occurring every day as we discuss here. What remains is the only the formality of respecting the former political leaders – something diluted and lost with each new generation. Consequently, I think it would be a mistake to put to much real importance on China’s 100 yr. “communist” anniversary. There are large number of internationally educated international business leaders in China that are looking forward to the day that the “communist” will let their political religion die, and accept the fact that just like the US, Europe and most of the rest of the world – they live in hybrid capitalism/socialism economic system. The Anniversary is likely to be more more show (for the remaining old guard communist political ideologies, but China’s march toward an even more capitalistic form of socialism isn’t likely to slow – nor is there a significant force in China to slow it.