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To: Haim R. Branisteanu who wrote (55292)	1/8/2001 1:08:21 PM
From: NOW	Read Replies (1) \| Respond to of 436258

Re: China growth: what percentage of their growth depends on the hunger of the US consumer? Perhaps it is relatively elastic to our economy? But they have their own set of banking problems which are not going away easily...

To: Haim R. Branisteanu who wrote (55292)	1/8/2001 1:08:21 PM
From: NOW	Respond to of 436258

Re: China growth: what percentage of their growth depends on the hunger of the US consumer? Perhaps it is relatively elastic to our economy? But they have their own set of banking problems which are not going away easily...

To: Haim R. Branisteanu who wrote (55292)	1/8/2001 1:15:05 PM
From: pater tenebrarum	Read Replies (1) \| Respond to of 436258

Haim, don't forget, China's official economic statistics are to be taken with not a grain, but a wheelbarrow of salt. China's banking system is in tatters...an estimated 50-60% of the loans on China's state owned banks books are non-performing duds. note also that China's economy is still very small compared to the big Western economies. i agree in principle though that contrary to popular misconceptions the entire world is NOT depending on the US consumer consuming him/herself silly. but Asia is. so with an economic downturn in the US and a further bursting of the asset and credit bubble, rest assured South East Asia will go into the toilet too, and that means recession for about 2/3rds of the global economy. real estate is in a bubble too in many regions, and looking at the leveraging of the GSE's balance sheets my guess is this will become the next major systemic financial concern. forget about telco growth in Europe...European telcos are even more crippled by huge debt loads, mainly due to the insane prices paid for licenses in G3 auctions. the point is, everybody suddenly realizes there are no reasonable profit margins to be achieved, and i guess that the expected build-out will be postponed for quite some time. liquidity can only be injected if there are takers for it. if the normal economic cycle phenomenon of rising savings rates and debt liquidation is ahead of us, the Fed will be pushing on a string. the boom is clearly turning into a bust, and since it was the biggest boom of all time, i expect the bust to mirror it commensurately. yes, it won't be a straight collapse due to the Fed and the government likely intervening at every turn. we'll have quite a few bull phases and economic recovery attempts. but supercycle bear periods are nasty...and they usually last longer than most people expect.