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To: BigBull who wrote (68080)	2/15/2001 4:41:29 PM
From: pater tenebrarum	Respond to of 436258

i don't know how to retrieve specific posts that were made that far back - but i can tell you the salient points again: most importantly, the Chinese banking system's assets are probably even more impaired than those of Japan's banks. it is estimated that 60% of all outstanding bank loans are duds, as the banks were forced to keep lending to technically bankrupt state-run companies for years on end. the size and inefficiency of the state-run sector are such that a true reform of China's bankruptcy laws would produce over 200 million unemployed people overnight. China has vast internal problems, which are largely unacknowledged in the West. for one, the rural population is dirt poor, has however no legal possibility to sell its land and move on. there are huge differences in the prosperity of various Chinese regions, due to the coastal 'special economic zones' far outpacing the interior in terms of economic growth. another ticking time bomb is demographic in nature: due to the 'one child' policy introduced under Deng Xiau-Ping China has now a huge surplus of young men (about 120 million) that will find no spouse. this is one of several reasons why i expect China to eventually go to war over Taiwan - it needs to channel the aggression potential of these unmarried young men, before they instigate a counter-revolution that threatens the communist party's grip on power. speaking of military matters, the Chinese army used to be involved in myriad businesses...a central committee decree that was issued about a year or so ago forced the army to divest itself from these businesses. during the grace period the army figures controlling these businesses have plundered them, leaving hollow shells. they now have nothing left to do, which is in itself dangerous. China has now gone through almost 30 months of deflation, with no end in sight (although the price decreases have begun to flatten out lately) due to the Yuan not yet having been devalued, something that is almost certain to happen this year, with as of yet unforeseeable consequences for the entire region (one can however guess that another round of competitive devaluations will follow in the wake of a Yuan devaluation).