> in a country with a bias towards savings

that's a myth that keeps being persisted, much like their consistent 6-7% gdp growth every year.

if you read the article, it mentions that 'He and his family had invested 7 million yuan - their life savings'.

"The Myth Of China's 'Excess Savings' Is Weighed Down By Excessive Debt. Bank balances offset against enormous, rapidly rising, bad debts, a property bubble out of all contact with reality, a closed capital account to prevent money draining overseas while it still can, and an unregulated shadow banking sector where vast pools of notional value endlessly gyrate on air currents of uncertain origin"

https://www.forbes.com/sites/douglasbulloch/2017/04/26/the-m...

The average Chinese citizens savings have now been engulfed in bitcoin crash, stock market crash, real estate bubble, p2p lending, and gold crash. When money can't leave China because of capital controls for average citizens, money goes into a risky bubble (otherwise it gets eaten away by inflation).

The biggest bubble, China's real estate, which has "$202 per square foot. That's 38 percent higher than the median price per square foot in the U.S., where per-capita income is more than 700 percent higher than in China." https://www.bloomberg.com/view/articles/2018-06-24/why-china..., is at a dangerous size. And it could be bursted by any external factors: Trump's threat to tax $500B Chinese imports, manufacturers hastened exist from China, Fed raises the interest rate a few more times, faster capital outflow from China, one of the emerging market's collapse, one of the more indebted private firm collapses, triggering a wave of collection, etc.

user:	varsitywork
created:	August 12, 2018
karma:	37