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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: GST who wrote (48353)12/29/2005 3:04:12 PM
From: ild  Read Replies (4) of 110194
 
Here is the risk. What if Chenese won't start consuming more? Also <<few hundred dollars more in consumption per person per year>> doesn't sound doable at all. According to Andy Xie (in the same link) annual per capita consumption is just Rmb10,000.

think China’s urban consumption is Rmb10,000 per capita at most. For the purposes of illustration, a taxi driver in Beijing might make about Rmb30,000 per annum, with a spouse who earns, say, another Rmb10,000 per annum. We believe such a family of three might typically look to save around 25% of its income, and could therefore afford Rmb30,000 consumption per year, or Rmb10,000 per capita.

Did you see this:

greater than 85% of the build-up in Chinese forex reserves during the post-2000 period can be traced to “hot money” -- capital inflows probably driven in large part by speculation on renminbi revaluation.
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