How do you solve the problem of a lack of demand in the Keynesian financial system, which has arisen due to massive manipulation of interest rates? You create new demand, with new manipulation of interest rates and new credit, executed by state actors. The crisis in the Chinese real estate market, the largest single market in the global economy, has taken on unspeakable proportions. The ongoing intervention of the communists to stimulate economic growth has resulted in 3.6 billion square meters of vacant housing, ghost towns and a huge overcapacity in the construction sector.
The Chinese are also unable to escape the failed economic thinking of the Keynesians and are now trying old-fashioned recipes. Regional state institutions are now supposed to lend developers a helping hand and take over empty housing to inject new liquidity into the system and stabilize prices. This is all the more important as the collapse in real estate prices is putting regional banks under massive pressure and has caused the credit mechanism to falter. China is turning into a typical stupid fiat economy that knows nothing other than intervention spirals and manipulation of the credit market, which is destroying the economic foundation that would be necessary to authenticate political totalitarianism.
Even America has a Keynesian problem but not as bad as China.
“Any country can borrow money and drive some growth, but that may not always lead to good growth. So, I think America should be quite aware that we have got to focus on our fiscal deficit issues a little bit more, and that is important for the world,”
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Getting zapped for quoting Jamie Dimon was not on my SN bingo card!
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Next time try Al Capone
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yikes that's razor thin margin for banking
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42 sats \ 1 reply \ @duvel 15 May
Do you think the issues in China's real estate will have an impact on European real estate?
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Maybe less demand for engeniering?
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3,000,000,000,000 Yuan / ~ 1,300,000,000 = 2,307.69 Yuan of outstanding real estate per capita ... Would that work as an average price per unit?
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