. This is a bit of a misconception because as of 2010-2023, Japan is the world's 3rd largest economy (it even dropped to 4th in 2017), while Japan was the world's 2nd largest economy from 1960's to 2010.
Plaza Accord 2.0 will not happen again because China will not kowtow to US economic coercion. Japan was forced to surrender to US after signing the Plaza Accord.
The economy equation is simple... They need to always sell their goods ( it is difficult if the world couldn't keep consuming )... and has a well paid consumers workers...not too well paid to keep inflation low. The development countries have one particular problem...too well paid workers that at some point don't want to consume... they want to save making the negative interest crisis problem time to time.
Actually, a stagnation like Japan's must be a kind of wet dream for the CCP. Stagnating at a high standard of living isn't catastrophic. Stagnating at China's current level is (and also goes against CCP's so called prosperity agenda).
The very difference between China and Japan is its military power. China has the ability to throw the shit to the fan. There is a high possibility that the CCP will invade Taiwan to prevent itself from failing, as the economy is terrible enough for the Chinese to start to doubt its legitimacy.
Instead of giving money to the developers, China could give over leveraged borrowers the money to help pay down their debts and avoid bankruptcy (aka a bottom-up solution like what people were suggesting during the Subprime Mortgage Crisis here in the US), and this would also allow people to continue spending money thus propping up the consumer spending market, and this could reduce inequality if it were done in a more redistributive manner (which China has supposedly made a priority). High inequality and rapidly aging society are the biggest threats to China's stability, but the best way to deal with both is via redistribution of wealth since it would make having children much easier from a financial standpoint.
I think it would be hard to pull off - investing in small apartments for speculative investments was all the rage in China, property values were always going up, until recently. When the govt started cracking down on property speculation by making it difficult to purchase 2nd or 3rd homes, then people started getting straw buyers, anyone else in their family for the paperwork. Bailing out everyone as you are suggesting, will be bailing out a lot of property speculators.
Given how China is based around authoritarianism, I doubt they would be able to manage such reforms without losing the support of their ruling class, upon whom the ruling party's survival depends.
Despite their claim, somehow Chinese government abhor the idea of giving actual people money, maybe due to rampant corruption. You can ask any number Chinese and I can assure you none of them got any monetary help out of the government during covid lockdowns. None, zero, nada. It is somewhat understandable, every time they give the officials the power to handle money, welp you guessed it, the money is gone. I mean it's a country that declares its intention to fight corruption yet didn't take any action known to man that's evidently effective, who could have known?
The problem with that is that it overheats inflation and turns the savings rate negative which carries its own set of problems (e.g., nobody has money for retirement), there are no reserves to butress against other shocks). When you start just giving money away people who have money start liquidating their accounts because they are depreciating, converting their cash to assets that will also inflate as prices rise like gold or real estate. China probably doesn't have to worry like most other states would about destroying confidence in the currency because nobody trusts it now, but they do need to worry about a negative savings rate and runaway inflation.
A country that is going to contract by 30-60% by 2100 is going to stagnate. Remember, slightly less than half of the Chinese population lives in the equivalent of American poverty. China’s strength is quantity, not quality. Pretty much nothing Xi can do but to end up like Japan unless he starts mandating women having no less than 3 kids
Literally, every developed country is experiencing low fertility rates. This is with the exception of Third World countries. Younger generations are less likely to get children or get married and it’s facts. This is also of each succeeding generation.
@@aviatorsound914 But the level is different, for example the fertility rate in Japan is below 1.50 for the last 30 years, but in the US the fertility rates never dropped below 1.50. Also the US and Europe are more open for immigrants (unlike China and Japan), that's something that helped compensate for their low fertility rates. and the last thing is that, China is not really a first world country in any means, if you look at it from a political perspective it does not belong to the western camp during the cold war, and if you look it at from an economic perspective, China is a developing nation not a developed nation.
Japan became a wealthy democratic and developed economy with well-functioning welfare & open-high trust finance system before stagnation. China has none of these. China’s economic bubble disproportionately benefited the ruling elites over the general populace.
I agree, China can FORCE huge money flows and projects, at a price. The thing is that price, huge debt ratios, is coming knocking. Debt exists, it is all about ratios. With a healthy ratio debt existing isn't going to kill you. But China easily is four time worse off then many other countries debt-ratio wise. Their "build it quick" came at the price of huge debts.
I find it crazy how Japan got so close to top world economy, that must've been a very embarrassing prospect for the Americans lol Edit for clarity: Look at Japan’s size and look at the US’ size (population, land area, resources etc). The US has crazy amounts of potential. Compare that to Japan, a mountainous archipelago that is not very resource rich, yet they got very close to overtaking the US economy. I’m aware the US helped Japan boom but they never expected that Japan might overtake them.
I find it crazy how Japan got so close to top world economy, that must've been a very embarrassing prospect for all the counties that they surpassed lol
@@FTL1511 Look at Japan’s size and look at the US’ size (population, land area, resources etc). The US has crazy amounts of potential. Compare that to Japan, a mountainous archipelago that is not very resource rich, yet they got very close to overtaking the US economy. I’m aware the US helped Japan boom but they never expected that Japan might overtake them.
I know several chinese nationals who moved to my country, Malaysia and seeking PR status. The stuffs they tell you about the economic situation in China is really surprising and rather grim. I find it hard to believe at times. If you see how China be talking about its economy, seems like they're doing fine, i guess you cant always believe what you see.
its a form of conformation / survivorship bias. They upended their lives because THEY were not happy - they were literally the least happy people in the country and now they have to justify their decision. They are by definition the LEAST reliable people for a description of what its like in China. There are 1.4 billion people who DIDNT leave buy you are getting the opinion of these 0.000000000001% who were miserable enough to leave. I collect stories of life in the USSR, I have to discount people who left for this reason, they are the LEAST reliable, but they THINK they are the most reliable - its a paradox.
One area that could help is by ensuring that banks only lending on finished property and not just lending off the drawing board as they have done in the past.
Okay, but lending to business is literally done on the basis of "I have a plan, this is how much money will be made, it just needs a lot of investment upfront". The bank just merely examines the feasibility of the proposal, accepts some collateral, signs a contract and gives the money.
China has been the sole equal of contemporary Roman empire since Antiquity, before existence of Japan and US, China rises again and again after each fall, when other great empires sink definitely, China is beyond the comprehension of many Westerners, so they could only comparing millennial China with a ephemeral power Japan, what is Japan, a WWII loser under US military occupation, a nation never manages to build great empire before 1850, and after 1850, their empire can't even last for decades, from Chinese perspective, its ancient adversaries such as Xiongnu, Gokturk, Mongol, Manchus are much more powerful and durable than Japan,
@@Gleifelin next decades, Japan automobile industry will be defeated by the Chineses, just like their smartphone and electrical appliances defeat, and Japanese aerospace and aeronautics industries are behind China, i have no idea how can future Japan remains rich for long term?
@@Emilechen Absolute propaganda drivel. If China is so great and the historical equal of Rome then why did Mao desperately seek to destroy everything about ancient China in the Cultural Revolution?
A massive number of those policies were based around both fighting the demographic decline and denying the demographic decline. The housing oversupply was based on inflated population figures, they borrow money assuming a 100 million home owners would come along and in reality they don't actually exist.
The stagnation era in Japan happened way before population decline did. The demo decline is an after effect(the economic burden leading to people thinking they can not properly shoulder the child raising costs)
Surprising you didn't mention the paris accord, or the parallels between US semi-conductor trade war against China with the US semi-conductor trade war against Japan.
That's what this fool doesn't tell, and think we don't. Japan's stagnation was caused by US and its allies against another ally like Japan. One should be very stupid like this speaker to believe China will accept another Accord Plaza-like agreement...
Monday Wednesday Friday: China is collapsing; Tuesday Thursday Saturday: China is strong and a threat to the world Sunday: can’t tell China is collapsing or getting stronger
Yea it’s hilarious reading the comments. People all love forming uneducated opinions and throw out fake stats left and right. We have heard of “China collapse” every single year for like the last twenty years
One slight correction, the episode of American lawmakers destroying Toshiba products was not just because of anxiety about Japan. Toshiba had been caught illegally selling highly advanced submarine engines to the Soviets, this was because of that.
Lol that was the perfect excuse. And yeah Toshiba was at fault there but 'Muricans simply couldn't accept some non-whites going above themselves, even though in many sectors the Japanese were simply better at innovating at much lower prices.
It wasn't submarine engines but Toshiba was selling machine tools to USSR that enables them to produce quiet and stealthy submarine propellers. And it was violating a treaty on controlling exports to the commie bloc.
Japan benefitted from being a democracy, with transparency in finance and government. Transparency safe guards helped protect their economic health and prevent a collapse. Plus their economy, like other western countries, out-matched the size of their people. $4.7T for 130 million people provides more cover than $19T for 1.2 billion, and $25T for 336 million more so. With an aging population, high youth unemployment, and low consumer consumption, Xi doesn't have such a safety net. A stagnate China would be devastating for them.
Japan was a democracy with a constitution prior to the war. They had some difficulties controlling their military but fundamentally they were a democracy. What led to their growth was the British, French, and Americans not discriminating against them economically.
its easier to develop a small population than it is to develop a large population,nevermind one the size of China the equivalent of literally dozens of countries and even multiple continents.......even humanity itself has never been able to reach a high level of human development other than in small pockets of the world and a few hundred million here and there and even that took a better part of a century.....when people speak of China, they speak of it as though its just another country with 25 million or 50 million people in it,which is already considered pretty large by most countries in the world standards, 50 million is merely one or two provinces in China...... gdp pc means nothing.....it can easily be skewed or manipulated to represent something else.....for example in a small country in a tiny population like Singapore, its GDP per capital is nearly 70,000?does that mean the average Singaporean is earning $70,000 a year or 6k a month? far from it, immense wealth and gdp is mostly concentrated in the hands of a minority......Singapore is after all a famous tax haven and......the median salary of ordinary singaporeans is merely 2 to 3k sgd a month..... likewise when u take the gdp and wealth of china and spread it over such a garguantuan population,the size of africa and middle east and eastern europe combined.......it seems so little barely 8,9000 usd per capital.....and by that metric u assume China is underperforming Japan?lmao... China already accounts for 17 percent of global GDP at its current level of consumption, with USA the largest coming in at 23% of global gdp.....if China were simply to double its GDP per cap within the next 10 or 15 years,its share of global gdp would easily dominate 35 to 40% of global GDP, China would no longer have to rely or depend on the world,China would literally be the world itself.....the world's economic engine, literally the sheer scale of the market, the domestic consumption and production and economic activity occuring in China alone....the only purpose the rest of the world would serve is to provide raw materials and resources for its gigantic economic machine.
I find it interesting how many analysts look at market fluctuations and bubbles as something outside of anything government policy does. If a policy is tried, but doesn't change things people realize it's a failure. But what is often overlooked is how those same policies encourage the bubbles in the first place (trade restrictions, manipulation of interest rates, etc), or how they actually made things worse. It's as if nobody ever wants to blame their government for creating the very problems people clamor for them to fix, which they can't really. For instance, having the government bail out companies or markets just shifts the burden from those businesses to the tax payer. Japan's tax rates are very high. And high taxes will slow domestic spending as available house hold incomes dwindle. Lowering interest rates just creates more debt, inflating asset values, and more bubbles which will trap tax payers in an ever increasing tax burden lowering their ability to spend on other things. We are seeing the exact same thing with China. And given China's political structure, China's economic decline will be worse than just a lost decade or two.
TLDR is run by socialists. They tune out when their bad idea's face consequences. Socialism can be pretty easily summed up on a war against consequence. Doesn't matter what the situation social economic etc. When you aggressively fight consequence you dam up all your problems and eventually the dam breaks.
Cause the market doesn't lie. When people learn about even stocks they realise something that's been building for 20 years suddenly "pop" at the exact time it's almost supposed to pop almost reaching a high point. Suddenly a news narrative comes in just bang on time to explain it. Makes them question it's almost like it was "supposed" to happen. The news lies. They feed you a narrative at certain times. By the time you notice it's already too late while with bubbles and market it paints a pictures as it goes on which allows you to interpret.
Japan's taxes are high? How do you work that out? For a developed country, Japan's taxes are relatively low. And if high taxes are so negative on growth, how come Denmark's GDP per capita is so much larger than Japan's?
@@apsoypike1956 Sorry, Denmark has never had low taxes. None of the Nordics have. Yes, I agree how you spend it is important and Japan spend theirs incredibly badly. It's just that the rate of taxation is totally irrelevant to long term growth. High taxation well spent, for instance to increase productivity, can lead to increased growth. Redistribution can lead to higher consumer spending.
@@bugsygoo Taxes are not the only factor of course. But GDP/capita is a poor indicator of impact on individuals. GDP is derived from overall productive performance of a nation. If you're population is relatively small, then your per capita average will look high. Denmark has a little under 6M people. Japan has 125M people. Different problems.
Becoming next Japan has a long way to go. As a Chinese, I was only expecting that we can catch up with S Korea in terms of most industry technological power in 10 years, such as in Ship building, Automobile, Electronic devices, Appliances, Chemical engineering, and Semiconductors.
@@wedmundsby that definition US is a third world country. Go look at Paris, known to be a city of rats. By the way I’m not bashing US or Europe but just showing how gullible your logic is
The reason that they are in a real-estate bubble to was because they used public work infrasturcture and land-lease finance to stave off the the effect of 2008 financial crisis to begin with. They are overlveraged on all level of government and its now reaching into the banking sector to gurrentee liquidity for the public sevices. There is a reason people in some key regional financial institution can't take out their saving, because even small amount of withdraw could precipitate liquidity crisis. In fact, they had action quantitated easing since locked down ended and that had not caused inflation years on year.
If China want to lower economic risk for their people, they should establish viable social security system (like state-guaranteed pensions or disability living allowances) instead of just pumping money into some ego or corrupt-driven projects.
@@TheBoobanthey literally pulled 90% of their population out of abject poverty, and used it to fund public infrastructure (ports, subways, rail, roads) and science to now lead the world in renewable energy and EVs. That’s what happened.
No they shouldn’t. The US has social security and it caused a birthrate crash. Instead of childless old people being destitute and elderly who had many kids being loved and cared for, they promoted people be selfish and spend their potential retirement savings on handbags and SUVs when they were young, then they promoted never having children and now my generation is expected to pay for those old people. They’re bad for the economy and didn’t produce any new humans to help spur the economy
There were zombie buildings here and there. But Japan is a lot smaller than China. China has ghost cities, Japan has zombie corporations. China desperately wants population growth and sees Sinification of inner Mongolia and Xinjiang as a way to achieve it. Japan will not entertain any methods of population growth (easiest is a controlled and steady legal immigration, but immigrants hate getting harrased by racist cops and shook down by protection rackets, and it is a thing in Japan)
Another giant problem with China is the over reliance on book cooking. China has always been many percent over what is even statistically possible growth wise. Even during lock downs their unemployment for a country of a billion people was literally impossibly low. Investors now see this and the world now sees the dangers of putting all thier eggs in a manufacturing basket. I meanvthe likes of apple are already looking for the next indentured servant population to build iPhone. So the collapse is unavoidable. The Chinese where used and abused like the cheap expendable labor they sold them selves as but the party is over for them now and it's back to the fields.
@@gzkony Don't think the original poster said that. China labor market is shirking because investors are diversifying from an unstable country. All those unskilled workers without a job are going to affect China economy in a big way.
a) Apple has already struggled to gain a foothold in India. Companies on their supply chain who they have persuaded have already reported loss since their move to India. Foxconn, Foxlink and Winstron for examples have all been met with disastrous results. Western nations already tried investing in ASEAN countries back in the 1990s, which caused the 97 Financial Crisis. So I would probably not see that as a certainty just yet. And even if Western companies decides never to return. Do you think the Chinese Gen Z will just give up? b) China is currently experiencing a massive transition into the tertiary industry - rather than being the factory of the world that produce products for Western brands, Chinese businesses are now taking over the production capacity to produce their own products. There will soon be a torrent of Chinese-made EVs to hit the European market in the coming 6 months. So yeah, TikTok, Huawei and DJI were only the vanguard of this transition. Soon, more companies will follow to cover more industries. No one could ever dream of Japanese companies like Sony, Toyota or Korean companies like Samsung or LG ever being able to become household names in the West but that's actually the norm not the exception. Just because you don't like the way the government run things do not make the least bit of difference. The truth is that it has always been the CCP's plan to move around from the Primary and Secondary sector once the country get rich enough to move into service and intellectual industries. The real stagnation was when China's economy was being complacent on that it already has. Now, the real challenge comes. And with all risks come opportunities.
@@BatCountryAdventuresHuawei, BYD and Tiktok are hyped up non-critical tech that relies heavily on government subsidies. CCP have nothing to offer aside from being cheap or getting free money someway out of it. Its not sustainable.
"deflation sounds good if your country is struggling with inflation". Yeah, I agree. I would like inflation to stop growing. If not deflation, an inflation rate of 0% does sounds nice here in Argentina.
Yeah, but the macroeconomic situation becomes WEIRD when that happens. The Great Depression was a period of intense deflation btw. Deflation occured as well as in the panic of 1873 which was called the "Great Depression" before the one in the 1930s hit. Deflation is sign shit's reallyyyy bad.
There is a bg difference between Japan then and the PRC/CCP now - mainly Japan did not go out of their way to antagonize their customers, or engage in "wolf warrior" diplomacy, have random crackdowns, and generally be abusive towards those who would buy their products or invest in their country.
The Chinese situation is a lot more dire than the Japanese, and the most significant reason for that is lack of education (especially relative to population size) affecting so many aspects it deserves a 500+ page study annually. The second largest reason is lack of Chinese access to any form of savings besides housing, while Japanese have a high rate of ownerships in stocks/bonds/futures.
No their situation is dire because of all the attacks from US and its Allies. They get hit on so many fronts. Not sure what you mean about lack of education. They have way too many college grads each year, especially in STEM area. They are now filing for most patents, writing most academic papers.
I don't think China can become like Japan since in the 90s Japan was already a fully developed country, China even now is still not, so it will be very different for them. They failed to "get rich before they got old".
Japan vs China. The wealth gap between Japanese middle income earner and lowest earner is very narrow, but in China the wealth gap is vast. Improvement of Japanese economy raised living conditions of the ordinary Japanese but in China, a labour is just a month away to be downed in poverty, therefore China can't be Japan, they may have same economy conditions but living standard will be totally different.
The average wages of the typical Chinese citizen has ALSO been tripled in a decade and a half. The main difference between Japan's rise and China's rise are: Scale! China is 14 times as large as Japan was. Japan was an enforced ally with the biggest economy in the world that they could easily sell to (think Sony, Panasonic, Toyota and Honda) while China isn't. Japan had already semi industrialized before WW2 so they had an established base, while China started from a much lower base after the cultural revolution and Mao did the best thing he ever did for China, which was dying.
Two major differences between China and Japan: 1. Japan became a First world country, with a GDP per capita at the time even higher than most developed nations, making Japanese people very very rich (not so much now, but still they are first world), while China has had exponential growth, but because of its massive population, it is still nowhere near a First World country. China tries to show very modern cities and make it seem like that is most of China, but the reality is very far from the truth, the truth is that China is still mostly a country with mostly a poor population. 2. Japan was a full and free democracy at the time, with respect for human and civil rights, and even now, but China is a full blown dictatorship that tortures dissidents, and harvest their organs.
True. China has potential (like any other country in the world) but for that potential to be unleashed, CCP must go. A good example of that is Taiwan -- it is what China could be without the CCP.
@@Besthinktwiceno, no it isn't. That's just a lie. Taiwan industrialized decades before china opened up, together with Korea and Singapore. It was the Asian Tigers' model that china sought to replicate with it's special economic zones that brought prosperity to China.
China grew 6.3 % this q2 2023 which is the world highest and you suddenlt speak about China stagnation? You deserved the most honorable Gordon Chang medal
"Deflation is bad because it scares economists"... and probably Ayn Rand, but neither of these things seem like a reason to strive not to become the next Japan.
People really not to stop being so god damn binary. It's not "let's be Japan" or "let's stay poor", there are other paths there. One country could possibly surpass Japan if they follow a more sustainable economic practice (like not lending excessively to support domestic businesses).
Authoritarian society controlled their population growth forcefully. It created demographic catastrophe. Indian approach was that we will focus on reproductive education and other methods. People got educated and now we have fertility rate at 2.1. Democracy didn't allow control of population forcefully. In short, The nature of system matters.
It's not just that. The CCP been cracking down on many companies in certain industry, making it too unpredictable for some and companies started leaving. Besides that, the wages in china increased to the point it's no longer the best option.
Yes, India is a super democratic power, and China should learn from India? India is the only big country capable of surpassing the United States. China has collapsed and won't accept any debate.
This is what everyone says but nothing is happening in China, do you know why? Because its all a lie, anti-China haters spending 24/7 spreading lies about China will soon collapse. For the past 60 years, the China collapse theory has always been around, sometimes its on their governance, sometimes its on their system, sometimes its on population growth, and sometimes its on economics, but to date, its all wishful thinking. Keep telling yourself it overstated is just making yourself feel better, there is no way some yellow people can surpass us, they are not even free, right? lol
@@逐鹿2024 no. Because your housing bubble which was responsible for over 20% of the growth is popping and because china decided it wanted to be the enemy of it's main customers and it has too much debt for it's actual gdp.
But the biggest problem is the population issue that Japan had as well in the 80s and 90s where they have a very unbalanced aging population. With a whole lot of order people and not many younger people and those younger people not having enough babies. Thjis is really the major issue with China and they have already tried to throw money at it and it failed for the most part.
No, i don't think the population crisis was the main reason for Japan's economic stagnation. South korea also had similar population crisis, but south Korea's growth still remains strong
@@Muhammad_Ahmad_ yah but aging population fast is a very important downwards vector for countries that have to work to gain money, unlike for joke countries with oil in the ground where they don't work anyway. Doesn't mean you'll end up going down but it pushes that way.
The U.S was a key contributor to Japan's economic woes simply out of fear that Japan would overtake it. Now, the U.S is trying to do the same thing with China, placing sanctions and technological restrictions on China in an attempt to stay ahead of the competition. Instead of the U.S to improve when facing competition, it resorts to breaking the competitor through unethical means
Demography hit Japan hard. Debt was bad too… Debt is crushing China. Bad demography is now going to hit harder. But policy will hurt the most: A CCP that made mistakes in a China that was too powerful to fail, can pretend like its decisions were not that bad. The CCP could do no wrong while the economy continued to improve. But as the economy stops growing, China won’t adapt the same way Japan did. Instead of decline, Japan has managed to maintain stagnation while its workforce shrank. China also creates policy based on ideology rather than off the market. Japan can adjust easier, and admit its mistakes quicker. Xi is now President for Life. He will not, or cannot, admit his mistakes. Authoritarian leaders fall if they look weak, so they just double down in hopes that sooner or later, their idea works. So he’ll make fiscal mistakes, then won’t adjust those decisions afterwards, and China is going to decline. His policy has also been more anti-Western, which has pushed foreign markets and investment away from China, and more leave every year for cheaper labor or controlling policies or public discontent with Uyghur genocide or any other number of reasons to leave China right now. No one wants to be the next foreigner arrested randomly as a political prisoner because some executive of Huawei got arrested in your home company. That genie is out of the bottle now and isn’t going back in.
Tell us you are biased and clueless without telling us. Anyone who uses the word genocide on Xinjiang is just brainwashed at this point. I don’t care if you accuse China of forced assimilation or whatever but if you don’t know what genocide means then google it first. US has been throwing that term out as propaganda. If China truly has a genocide campaign you don’t think the Arab world would go crazy? Arabs aren’t afraid to standup to US the most powerful military in the world. Anyone who has an ounce of intelligence knows it’s a BS propaganda.
6:21 It seems like at least four of the features mention here are present in Sweden (debt-fueled property bubble, export driven economy, weakened consumer demand and ageing population). Do you think the Swedish economy could also follow a similar path to Japan/China soon?
Your perception is just that of your own country, everybody thinks their country is doing bad till they see somewhere that's doing worse, look at statistics compiled by reliable institutions and you'll get a better idea.
@@chinguunerdenebadrakh7022 I live over an hour from any major cities, and yet even in the small town where I live the housing prices are now over $1 million, with many being between $1.4M and $1.9M. Inflation is high, costs are high and if you want to talk about statistics Canadians have the highest person debt rates in the G7 and household debt is at 187 per cent of disposable income. $59,300 is the average Canadian income, try buying a million plus dollar house on that, even as two income house hold and being able to afford food and insane gas prices thanks to endless carbon taxes. The grass my not be greener else where, but it sure is yellow and dying here.
@@Balorian Okay, let's talk inflation first because that's the easiest. Inflation is hard to deal with, but how is it relevant here? The point you raised was parallels with Japan, Japan didn't have high inflation prior to the early 90s when their bubble burst. And Japan's been in a severe threat of deflation ever since. And housing prices? That's more local regulations than any macroeconomic indicator of if the country's gonna shit their pants. If you zone entire areas near some of the most productive cities in your country for "single family housing", it's obviously going to be tough to have enough housing for everyone. Japan did not in the 90s and does not in the present have any such issue (of land regulation) because their developers can build relatively freely (and their housing prices are also affected by earthquake regulations which lowers house prices over years (because you might be required to do upgrades that bring the cost up to near parity with new housing) but that's beside the point and a very Japanese problem). Japan's property price boomed because 1) there was expectation their economy would keep skyrocketing, so it was valuable to invest in such properties 2) the underlying factor behind it was the insane postwar recovery of Japan's economy which was fueled by governments giving for-profit banks quotas to lend to "strategic industries", it worked well enough till it didn't because it contributed to the bubble by creating inefficiencies and oversupply of credit in the market. There's no similar expectation for Canada, investors probably expect Canada to grow 2-4% annually for the next 30 years. And considering how little Canadian banks were affected by 2008 (so much so it became a case study), I'd say credit oversupply and bad loans aren't that big of a problem as well.
China's future is much worse than Japan's. Japan has stagnated into one of the most prosperous, wealthy, democratic countries in the world. Japan is allied with the most powerful country in the world the USA. There is an argument to be made that Japan is the USA's closest ally. The shortcomings of Japan's system and fallout from their economic stagnation is mitigated by the fact that they can depend on the US to help them. China used its economic might to line the pockets of the elite and plunge their nation into an authoritarian cult of personality. China has essentially no friends except maybe Russia who is not long for this world. China will likely cease to exist in its current form in the near future. The CCP is not designed to hold things together when things aren't going well. We will likely see the collapse of the chinese system and the country likely break apart into several smaller nations. It has happened several times in China's past.
Yeah I don't expect that another set of "five year plans" and "great steps forward" can fix china. Actually they are in the trouble they are because of these actions. So doing even more is like digging deeper to try to dig yourself out of a 90feet deep hole.
this year South Korea begins to have commercial deficit face to China, the last and most important industry of Japan, automobile, will be taken over by the Chinese companies in nect decades, in aeronautic and aerospace, both SK and Japan are backward comparing to China,in 2023 Japan has already 3 spatial failure, so as long as China get richer, SK and Japan will get poorer, when you go to a European Smartphone maket, Sony don't exist anymore, neither LG, yhe only Korean brand is Samsung but we see so many Chinese brands: Xiaomi, Honor OnePlus, Oppo, Vivo, China is not a vassal under US military occupation, long befote existence of US and theit Germanic tribe ancestors, China has already traded with Roman Empire with enormous commercial benefits, basically, US has tried all means but still unable to defeat China in a trade war, so the only thing can do is to repeat: China will collapse, China wil collapse...
@@kevinvkluger2652 it is, and would be very different but the idea that it was caused by a fall in asset prices, that's scary if you look at how high they have gone in Australia
Australia doesn't have rapid declining population grown or shortage of resources on the contrary it is one of the few countries which has the best environment for growth in coming years
Will China become the Next Japan? Sort of but also the circumstances are very different. The video mentioned China has or can learn from mistakes in Japan but what wasn't mentioned is that China's GDP per capita is roughly 1/3 of what Japan was when it began it's crisis. That means Chinese labor is still very cheap relative to the high labor costs of Japan. The higer the GDP per capita and higher labor wages, the less room for further growth. China still has a lot of room for growth opportunities just based on their low wages. That's why economist are estimating around 3% annual growth over next 20 years for China and not the 0-1% growth that Japan had since the early 90's. But to add historical context, when Japan was China's GDP per capita in the 60's, Japan would have 6-7% annual growth for the next 25-30 years! China is going to have 3% annual growth and that's a massive difference and why China isn't going to join the upper income nations anytime in the next few decades.
growth is unsustainable when your population is aging extremely quickly, customers are running from your hatred towards them and all the engines of the fake gdp growth are busted such as housing. And well, when your gdp numbers have always been a lie, then following growth numbers are a joke too.
China’s corruption level is only matched by Russia and Zimbabwe, therefore a bit of inflation is likely since people keep not receiving enough public money. However, the trend (despite China’s ridiculous lies of economic growth and tenfold GDP) seems to point towards stagnation … and the bad news is that Western economy depends on China’s, just as China’s depends on ours.
It was not the correction in stock prices and home prices to levels, people would buy at, Japan did not recover from. It was the investment in non-yielding capital, Japan did not recover from.
Offically, South Korea is not supplying Ukraine with artillery shells. I'm not saying 100% they are not but no one outside of a handleful can say for sure that SK is giving Ukraine artillery shells.
I think he was focusing on manufacturing rather than direct aid. If SK manufactures components that are used in the shells, then the supply lines run through SK.
Korea sends the shells to US storage, so US can send American shells to Ukraine. It’s basically, America doesn’t like having zero shells (what if something else happened somewhere else around the world) and so this way Americans can have their guns for emotional support, but also send them to Ukraine.
Let's compare Japanese and Chinese history. The Japanese didn't want Europeans to land on their island. They knew about the Dark Ages diseases. The British wanted to conquer Japan, so they began to cannonade cities along the shore. That Japanese relented and sign trade agreements. Japan was also used by the United States so Americans could be the first self-declared nuclear super-power. When the British were attacking Japan, England and other countries attacked China, but China won. That was when the English were saying it was legal for them to attack China and India, so they could trade tea from India for opium from China. The Victorian era in England is known as the opium era. Japan created an international trade war with America, what is the third world war, winning it, China with other Asian nations joined in. I'd be asking will the United States become the next England, a failed empire.
@@eawproductions the only reason britain is so rich is because of their colonisation in the past , a country like that will never become what it is today and also the present situation in UK is fuxked up , rents are through the roof
@@eawproductions The only reason you can say Britain had a smaller form of empire building is because they used ocean going boats and cannons, not atom bombs. If you were Scottish you wouldn't think the British were moral at all, as government and as a people. It took a British slave trader to write "Amazing Grace". That says it all.
I take issue with the deflation statement. It is *rapid* deflation, just as rapid inflation, that causes issues. A deflationary cycle of 1% per year bothers no one, just as a 1% inflationary cycle goes unnoticed. It is when it gets past 5% that it starts to become problematic. The reason people don't like deflation is that it hurts borrowers and merchants and manufacturers. A stronger currency means its harder to pay off the loan because the loan becomes "worth more" and if wages start to decline, you get the idea. At the same time, the stock in any given store loses value while it sits on the shelf because it takes less money to buy it. INflation, on the other hand, hurts lenders and savers. A bank loan becomes less valuable as the "worth" of that loan decreases because the value of the currency is decreasing. Simultaneously, anyone with a savings account is losing money because the rate of inflation exceeds the rate of return. Add to this that, if to try to retain employees, businesses start raising salaries (which raises their product prices at the same time), then it will be that consumers can pay back their debts more easily, because fixed rate debt such as mortgages and auto loans become a lower percentage of their monthly income. Now, for both of these, there are also impacts on exports and imports that get rather complicated when you factor in exchange rates and policies of the trading partners that get into "strong dollar vs weak dollar" arguments which are also mostly bogus arguments made by people who have seemingly no understanding of economics beyond a jr high school level. (I'm looking at you, Janet Yellen.) Their analysis is based mostly on pre-conceived notions they acquired in school, not from their own study because most of them don't want those preconceived notions broken. Most of then stop learning when they leave school because they can't tolerate the real world not lining up with what they were taught. The dirty little secret in all of this is that governments hate deflation because it reduces tax takings as wages and the cost of goods decline. That's why governments don't like it. Deflation is not a bad thing. It is just misunderstood because there's an inherent bias against it, rather than an interest in understanding it and evaluating its impact. Fiscal "stimulus" is also something that people take for granted these days for precisely the same reason. It relies on what is called the "wealth effect" which, when you examine it over the longer term, say two or three years, rather than just a few months, turns out to be complete garbage. Economics is complicated and most economists (like Alan Greenspan did after he retired, and the guy I hold in no small part responsible for the 2008 crash) will tell you that, when it comes right down to it, honestly, they're just guessing. An educated guess, sure, but still just a guess.
China is now in much worse condition than Japan in 1990. The real estate bubble is more severe, the population is already in decline, much less technological development, no quality ethic, the country and people are much less wealthy, pollution, water shortages, corruption, no rule of law, and the tyrannical government will try to prolong the bubble (and other distortions) instead of letting it pop. Lost decades are the BEST that China can hope for.
@@J_X999 I haven't been talking about the collapse of China for more than about 2 years, and my time scale is sometime this decade. The earliest prediction I'm aware of is Gordon Chang's book from about 20 years ago. He was off in his timing.
@@dzcav3 Yep, that's literally my point dude. People are constantly predicting the collapse of China within the frame of a decade. When that prediction inevitably fails, they just push it on to the next decade. Gordon was wrong about his prediction 20 years ago. Yet he's still going and people blindly believe him to this day. Zeihan's the new boy on the block. He predicted the collapse of China for the 2010s, but now he's doing exactly what I said he'd do and he's pushed the prediction into the 2020s. Every time this happens, people are convinced it's going to happen. "It hasn't happened like we said for the last 4 generations, but this time will be different, this time it's actually happening 🥺"
Yes. And it’s already decreasing in count as of this year. Going below a billion, like Japan below 100 million will be a sobering thing to witness, as it’s a decline many nations never experienced, and some who did, hasn’t since a major famine, genocide, or plague/smallpox pandemic Their economies will have long term decline, possibly until another era of population growth
I’m very doubtful about any more population growth since younger people will have a less likely chance with each succeeding generations to have children or get married. There’s a lot of different factors were younger generations are less likely to have children since there’s a lot of conditions, you have to examine.
also, as in all dictatorships, everybody sends bogus data upwards because failing to reach a target is bad enough... pushing real data about failures upwards is a crime.
@@schloops8473this is assuming leadership doesn’t care about statistics which would contradict their meritocracy. Most of their senior leaderships are engineers, unlike US leadership that is typically career politicians. Who do you think would choose to be more pragmatic? Engineers or politicians? I’m not arguing for which system is superior but I find it amazing how uneducated your opinions are. It’s like full of your personal feeling and emotion towards ideology rather than look at it objectively and using logic
all that is very nice. Now a dose of reality: engineers are useless when they have to refuse truth for the idiotic ideology and propanganda and corruption of the idiotic dictatorship. @@dailyrant4068
The big difference between Japan and China is that China gets old and the economy stalls before the people get rich. Japan ranked second in the world in terms of overall GDP and GDP per capita. In the case of China, the per capita is still low and the gap is large, and if there is no economic growth of more than 5% every year, China will not be able to maintain the employment of its people.
It wasn't outpacing them, it was crippling the US working class and causing deindustrialization of the rustbelt. Japan wiped out the American midwest. It's why detroit became detroit.
That’s only natural, as Japanese manufacturing also goes downhill. Chinas manufacturing also gets replaced by cheaper alternatives in many areas. US simply isn’t competitive at manufacturing
knowing what happened to Japan helps them with nothing .... ccp knew about the demographic crisis looming since the 90's yet did nothing for 2 decades .
in the real world, yes. In the CCP's world, the upwards layers gave GDP targets to the lower levels and those have to push bogus data up or they'll get arrested.
@@advancetotabletop5328clearly you have no understanding of either economics or accounting. You can’t just magically cook a book and turn it into real things. They can’t possibly just make up numbers. It’s ok, we know you have some personal hatred for China and makes you say stupid comments publicly
@@jzzzxxx You'd be surprised how many people don't know or think that. A lot of people seem to be trying to push that even, that China will just end up like Japan and "be ok" but in fact while it's very similar, it's not the same at all.
When "The Economy" stagnates, it leads to falling prices and then transactions come back. Macro is just he sum of micro and micro agents hall have different price at which they transact. Stagnation is necessary after booms when everyone bought at the same time. The boom was the calamity. Not the correction.
Unlike japan in the early 90s, china still has many of the headwinds that create the middle income trap. This could actually end up a lot more severe as a result. Lets hope not.
@@kth6736 The problems that create the trap don't go away when you stop officially being a middle income country. I really hope the current situation only stagnates (or not even that). But a economic and political shakeup at this point brings thoughts of 20th century Argentina to mind.
@@TrabberShir I dont understand how can a high income country fall into the middle income trap. Argentina is the exact opposite of china. Too much populism. China does zero populism.
@@kth6736 In the first 30 years of the 20th century, Argentina went from being one of the poorer former Spanish colonies to being, by some measures, the 5th richest country in the world. That all ended with the start of the great depression. How much of Argentina's failure to truly recover from the depression is political versus economic is very much an active academic debate.
I wonder how each country would fare today if, suddenly, they had no access to other countries and anything outside of their current territory (as defined by international law). Which would suffer and be set back the most and longest? Which would actually prosper? Which would break up into smaller states?
When TLDR talks about economy, it does it in a irritatingly conservative way. It should be clear as the sun that traditional economic theory cannot explain current situations and it CERTAINLY CANNOT find solutions to current crises. Our overpopulated, environmentally compromised world, has no room for traditional expansionist measures.
Every time I hear stories of recessions, I always return to the same question: why does it matter if the economy stops growing? If everyone's taken care of, why does it matter that the money numbers aren't getting bigger? If everyone's not taken care of, why is the economy the priority rather than the people? What's the economy growing for? If it's to build a safety net, then shouldn't stagnation be fine? Why is an economy coasting along a bad thing?
Because old people don't produce but drain money. Too many old people means not enough money. If populations stagnated at a healthy proportion old to young people, that would be fine but old people are making up more and more of the population.
@@only_fair23 If it did, that would be perfect. So, minor growth would be good in the short term, as long as we stagnate soon after, right? Our planet's resources are already crumbling under the last population boom, so more growth would hasten draining oil reserves, drying rivers, food shortages, wildfires, ultimately creating a much worse fallout. No matter what, economies are gonna turn towards a continual shrink, and the sooner we accept that, the less severe the whiplash will be. In other words, stagnation would have been fine, but we're already well over capacity for how our systems work. Either we push to make better use of what we got right, reduce the number of consumers, or load up the powder keg further with more growth.
@@Tralfazz74 We're not stagnating at a healthy proportion. If things continue like this, old people will make up the majority of the population which is a problem as old people can't work
@@only_fair23 I wonder what's gonna break... The majority of work that employed large amounts of people are or can be done with automation, or by a small number of people with machines. Relative to the number of working-age people, there isn't much work that needs to be done which benefits people. It's common practice in lots of big businesses to invent jobs simply to bolster your company's rep with employee numbers--a pretty roundabout way to give someone the money they need. I have lots of family who are or have been in the US military. Every single one of them has a laundry list of stories where the Army spent ungodly amounts of money because they could: Once, they took 12 privates out onto a base and fired numerous $50,000 howitzer rounds to "flex America's strength on the recruits". $800,000 to flex on 12 people. Another time, an officer was talking to my cousin about his time in Afghanistan-- he mentioned that they would drive empty caravans through unpopulated areas because, and I quote, "The military gives us a certain amount of money each quarter. If it looks like we spent it all, then we can ask for more next year." Most our labor is automated, and a large part of what isn't is on it's way out. We certainly don't have a shortage of money, so jobs that exist just to grow the economy are basically filler to make big number go bigger. Our country can afford to pay everyone a living wage, but chooses to dump hundreds of billions onto military hardware they never plan to use. If it's a problem of old people not contributing or needing care, the US can afford to pay caretakers great salaries and take care of large sums of their medical bills, no question. The USA COULD do that, but as long as companies prioritize money and the country demands GDP growth even in bad times, that money will never go to the people who are working or in need. Honestly, if the government just diverted money from the military to healthcare, it would still count as GDP. They could keep their big number while also helping regular Americans. You may have guessed, but I'm an US of American. I don't know where you're from, or how relatable this is.
Most jobs cannot be automated, I don’t know exactly which ones your thinking of but automation replacing everyone idea is hugely overstated. As for switching from military spending to giving everyone a wage is that if people aren’t producing anything, then there’s gonna be a supply shortage and then inflation will skyrocket, as people will have more money to spend on less stuff. As for the greater point about how most jobs don’t help people, do you not consume stuff? Would you be willing to give up every amenity in your life? Give me an example of a job that doesn’t benefit anyone.
Surely, half of Europe, and UK in particular, would be delighted if their economy was just stagnating and they would have to wonder about the future rather than experiencing the struggles in real time. But sure. Let's be concerned about China😉
one fact ignored is that the total GDP of China is three or four times more than the GDP of Japan. the mainstream media in China always compare the country with America rather than Japan so Japan has never been China's benchmark
It is amusing how Japan's economy has stagnated for 30 years and its still the 3rd largest economy on earth.
@liversuccess1420considering Japanese automakers suck at going EV. Later this decade will be awful for Japan
This is why Japan's economy stagnated. th-cam.com/video/P9PfheB9yA0/w-d-xo.html
. This is a bit of a misconception because as of 2010-2023, Japan is the world's 3rd largest economy (it even dropped to 4th in 2017), while Japan was the world's 2nd largest economy from 1960's to 2010.
@@Se5-s5bso they are back at 3rd place .....
@@RP-16 So the car market makes 100% of a country's economy?
It's amazing how history can repeat itself, but also how repetition could be avoided.
Except that China and Japan are totally different.
Plaza Accord 2.0 will not happen again because China will not kowtow to US economic coercion.
Japan was forced to surrender to US after signing the Plaza Accord.
History doesn’t actually repeat, but it does rhyme a helluva lot.
The economy equation is simple... They need to always sell their goods ( it is difficult if the world couldn't keep consuming )... and has a well paid consumers workers...not too well paid to keep inflation low.
The development countries have one particular problem...too well paid workers that at some point don't want to consume... they want to save making the negative interest crisis problem time to time.
@@omg-real-tvvery similar in terms of low fertility rates, wealth distribution, investments, infrastructure..
Actually, a stagnation like Japan's must be a kind of wet dream for the CCP. Stagnating at a high standard of living isn't catastrophic. Stagnating at China's current level is (and also goes against CCP's so called prosperity agenda).
The very difference between China and Japan is its military power. China has the ability to throw the shit to the fan. There is a high possibility that the CCP will invade Taiwan to prevent itself from failing, as the economy is terrible enough for the Chinese to start to doubt its legitimacy.
Instead of giving money to the developers, China could give over leveraged borrowers the money to help pay down their debts and avoid bankruptcy (aka a bottom-up solution like what people were suggesting during the Subprime Mortgage Crisis here in the US), and this would also allow people to continue spending money thus propping up the consumer spending market, and this could reduce inequality if it were done in a more redistributive manner (which China has supposedly made a priority). High inequality and rapidly aging society are the biggest threats to China's stability, but the best way to deal with both is via redistribution of wealth since it would make having children much easier from a financial standpoint.
Agreed, let's hope they don't take your good advice and it leads to a political reformation.
I think it would be hard to pull off - investing in small apartments for speculative investments was all the rage in China, property values were always going up, until recently.
When the govt started cracking down on property speculation by making it difficult to purchase 2nd or 3rd homes, then people started getting straw buyers, anyone else in their family for the paperwork. Bailing out everyone as you are suggesting, will be bailing out a lot of property speculators.
Given how China is based around authoritarianism, I doubt they would be able to manage such reforms without losing the support of their ruling class, upon whom the ruling party's survival depends.
Despite their claim, somehow Chinese government abhor the idea of giving actual people money, maybe due to rampant corruption. You can ask any number Chinese and I can assure you none of them got any monetary help out of the government during covid lockdowns. None, zero, nada.
It is somewhat understandable, every time they give the officials the power to handle money, welp you guessed it, the money is gone. I mean it's a country that declares its intention to fight corruption yet didn't take any action known to man that's evidently effective, who could have known?
The problem with that is that it overheats inflation and turns the savings rate negative which carries its own set of problems (e.g., nobody has money for retirement), there are no reserves to butress against other shocks). When you start just giving money away people who have money start liquidating their accounts because they are depreciating, converting their cash to assets that will also inflate as prices rise like gold or real estate. China probably doesn't have to worry like most other states would about destroying confidence in the currency because nobody trusts it now, but they do need to worry about a negative savings rate and runaway inflation.
I believe this could be attributed to China's and Japan's extremely low fertility rates.
New people=clean balance sheets=profit maximization
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Of course it is, everyone knows that
A country that is going to contract by 30-60% by 2100 is going to stagnate. Remember, slightly less than half of the Chinese population lives in the equivalent of American poverty. China’s strength is quantity, not quality. Pretty much nothing Xi can do but to end up like Japan unless he starts mandating women having no less than 3 kids
Literally, every developed country is experiencing low fertility rates. This is with the exception of Third World countries.
Younger generations are less likely to get children or get married and it’s facts. This is also of each succeeding generation.
@@aviatorsound914
But the level is different, for example the fertility rate in Japan is below 1.50 for the last 30 years, but in the US the fertility rates never dropped below 1.50.
Also the US and Europe are more open for immigrants (unlike China and Japan), that's something that helped compensate for their low fertility rates.
and the last thing is that, China is not really a first world country in any means, if you look at it from a political perspective it does not belong to the western camp during the cold war, and if you look it at from an economic perspective, China is a developing nation not a developed nation.
You guys should interview more experts like this sometimes. It's good to hear from the source itself.
This was a special occasion when they went to the NATO summit, I think they said they prefer not to interview people.
Japan became a wealthy democratic and developed economy with well-functioning welfare & open-high trust finance system before stagnation.
China has none of these. China’s economic bubble disproportionately benefited the ruling elites over the general populace.
The irony is the communist revolution was supposed to be about alleviating the country and society of just that. It was all a lie to gain power
I agree, China can FORCE huge money flows and projects, at a price. The thing is that price, huge debt ratios, is coming knocking. Debt exists, it is all about ratios. With a healthy ratio debt existing isn't going to kill you. But China easily is four time worse off then many other countries debt-ratio wise.
Their "build it quick" came at the price of huge debts.
Apparently, you never lived in China and seriously studied what you talked about.
@@jayzhang7527五毛
@@jayzhang7527 I’d be more cautious when making assumptions about strangers on the internet
I find it crazy how Japan got so close to top world economy, that must've been a very embarrassing prospect for the Americans lol
Edit for clarity: Look at Japan’s size and look at the US’ size (population, land area, resources etc). The US has crazy amounts of potential. Compare that to Japan, a mountainous archipelago that is not very resource rich, yet they got very close to overtaking the US economy. I’m aware the US helped Japan boom but they never expected that Japan might overtake them.
I don't see why it would be embarrassing, America helped Japan grow, an important ally for the US.
Its just bullshit capitalism rivalry
What's embarrassing was the USA's attitude towards japan's economic rise, why would one sabotage an Ally like that?
I find it crazy how Japan got so close to top world economy, that must've been a very embarrassing prospect for all the counties that they surpassed lol
Looking at how much harder and longer the Japanese works, the embarrassment should be on the other side.
@@FTL1511 Look at Japan’s size and look at the US’ size (population, land area, resources etc). The US has crazy amounts of potential. Compare that to Japan, a mountainous archipelago that is not very resource rich, yet they got very close to overtaking the US economy. I’m aware the US helped Japan boom but they never expected that Japan might overtake them.
I know several chinese nationals who moved to my country, Malaysia and seeking PR status. The stuffs they tell you about the economic situation in China is really surprising and rather grim. I find it hard to believe at times. If you see how China be talking about its economy, seems like they're doing fine, i guess you cant always believe what you see.
this CIA-level coping. you think you're smart that IMF and World Bank🤡
its a form of conformation / survivorship bias. They upended their lives because THEY were not happy - they were literally the least happy people in the country and now they have to justify their decision.
They are by definition the LEAST reliable people for a description of what its like in China. There are 1.4 billion people who DIDNT leave buy you are getting the opinion of these 0.000000000001% who were miserable enough to leave.
I collect stories of life in the USSR, I have to discount people who left for this reason, they are the LEAST reliable, but they THINK they are the most reliable - its a paradox.
I love the PR status in SEA countries. 5 yr, 5 yr, 5 yr, anytime bye bye. Not like the west. Just hang around 5 yrs and get citizenship.
@@paullnetinstitute4799what?
@@paullnetinstitute4799bro, it's malay, not CIA. Wtf are you talking about?
One area that could help is by ensuring that banks only lending on finished property and not just lending off the drawing board as they have done in the past.
Okay, but lending to business is literally done on the basis of "I have a plan, this is how much money will be made, it just needs a lot of investment upfront". The bank just merely examines the feasibility of the proposal, accepts some collateral, signs a contract and gives the money.
The way it is going saying China will be the next Japan is WAY too optimistic.
yeah at least japan was relatively rich before stagnation set in...
China has been the sole equal of contemporary Roman empire since Antiquity, before existence of Japan and US,
China rises again and again after each fall, when other great empires sink definitely,
China is beyond the comprehension of many Westerners, so they could only comparing millennial China with a ephemeral power Japan,
what is Japan, a WWII loser under US military occupation, a nation never manages to build great empire before 1850, and after 1850, their empire can't even last for decades,
from Chinese perspective, its ancient adversaries such as Xiongnu, Gokturk, Mongol, Manchus are much more powerful and durable than Japan,
@@Gleifelin next decades, Japan automobile industry will be defeated by the Chineses, just like their smartphone and electrical appliances defeat,
and Japanese aerospace and aeronautics industries are behind China,
i have no idea how can future Japan remains rich for long term?
@@Emilechen +50 social credit. Congratulations you can ride on trains again.
@@Emilechen Absolute propaganda drivel. If China is so great and the historical equal of Rome then why did Mao desperately seek to destroy everything about ancient China in the Cultural Revolution?
I don't think the economic stagnation in Japan is caused by bad economic policies.
It's driven by demographic decline.
A massive number of those policies were based around both fighting the demographic decline and denying the demographic decline. The housing oversupply was based on inflated population figures, they borrow money assuming a 100 million home owners would come along and in reality they don't actually exist.
That's true. Now imagine the level of economic stagnation that China has in store for it due to both bad economic policies AND demographic decline.
The stagnation era in Japan happened way before population decline did. The demo decline is an after effect(the economic burden leading to people thinking they can not properly shoulder the child raising costs)
There was no population decline in Japan when stagnation began
The stagnation started during a period where there were still many young folks around
Surprising you didn't mention the paris accord, or the parallels between US semi-conductor trade war against China with the US semi-conductor trade war against Japan.
That's what this fool doesn't tell, and think we don't. Japan's stagnation was caused by US and its allies against another ally like Japan. One should be very stupid like this speaker to believe China will accept another Accord Plaza-like agreement...
Monday Wednesday Friday: China is collapsing;
Tuesday Thursday Saturday: China is strong and a threat to the world
Sunday: can’t tell China is collapsing or getting stronger
Yea it’s hilarious reading the comments. People all love forming uneducated opinions and throw out fake stats left and right. We have heard of “China collapse” every single year for like the last twenty years
One slight correction, the episode of American lawmakers destroying Toshiba products was not just because of anxiety about Japan. Toshiba had been caught illegally selling highly advanced submarine engines to the Soviets, this was because of that.
Lol that was the perfect excuse. And yeah Toshiba was at fault there but 'Muricans simply couldn't accept some non-whites going above themselves, even though in many sectors the Japanese were simply better at innovating at much lower prices.
“Yeah smashing this printer is totally going to get Toshiba to stop being bad!”
It wasn't submarine engines but Toshiba was selling machine tools to USSR that enables them to produce quiet and stealthy submarine propellers. And it was violating a treaty on controlling exports to the commie bloc.
It was propeller milling equipment not engines.
@@remmond3769 It was illegal under COCOM export controls, and I never sold weapons to anyone
Japan benefitted from being a democracy, with transparency in finance and government. Transparency safe guards helped protect their economic health and prevent a collapse. Plus their economy, like other western countries, out-matched the size of their people. $4.7T for 130 million people provides more cover than $19T for 1.2 billion, and $25T for 336 million more so. With an aging population, high youth unemployment, and low consumer consumption, Xi doesn't have such a safety net. A stagnate China would be devastating for them.
Been watching Zeihan?
Japan was a democracy with a constitution prior to the war. They had some difficulties controlling their military but fundamentally they were a democracy. What led to their growth was the British, French, and Americans not discriminating against them economically.
China? become Japan? *NOT* *EVEN* *CLOSE* 1st off Japan dont build *FakeStuff...SanluSpecies*
its easier to develop a small population than it is to develop a large population,nevermind one the size of China the equivalent of literally dozens of countries and even multiple continents.......even humanity itself has never been able to reach a high level of human development other than in small pockets of the world and a few hundred million here and there and even that took a better part of a century.....when people speak of China, they speak of it as though its just another country with 25 million or 50 million people in it,which is already considered pretty large by most countries in the world standards, 50 million is merely one or two provinces in China......
gdp pc means nothing.....it can easily be skewed or manipulated to represent something else.....for example in a small country in a tiny population like Singapore, its GDP per capital is nearly 70,000?does that mean the average Singaporean is earning $70,000 a year or 6k a month? far from it, immense wealth and gdp is mostly concentrated in the hands of a minority......Singapore is after all a famous tax haven and......the median salary of ordinary singaporeans is merely 2 to 3k sgd a month.....
likewise when u take the gdp and wealth of china and spread it over such a garguantuan population,the size of africa and middle east and eastern europe combined.......it seems so little barely 8,9000 usd per capital.....and by that metric u assume China is underperforming Japan?lmao...
China already accounts for 17 percent of global GDP at its current level of consumption, with USA the largest coming in at 23% of global gdp.....if China were simply to double its GDP per cap within the next 10 or 15 years,its share of global gdp would easily dominate 35 to 40% of global GDP, China would no longer have to rely or depend on the world,China would literally be the world itself.....the world's economic engine, literally the sheer scale of the market, the domestic consumption and production and economic activity occuring in China alone....the only purpose the rest of the world would serve is to provide raw materials and resources for its gigantic economic machine.
The difference between Japan and China is laid in slavery. In this case, Japan is the slave of the US, while China is not.
I find it interesting how many analysts look at market fluctuations and bubbles as something outside of anything government policy does. If a policy is tried, but doesn't change things people realize it's a failure. But what is often overlooked is how those same policies encourage the bubbles in the first place (trade restrictions, manipulation of interest rates, etc), or how they actually made things worse. It's as if nobody ever wants to blame their government for creating the very problems people clamor for them to fix, which they can't really. For instance, having the government bail out companies or markets just shifts the burden from those businesses to the tax payer. Japan's tax rates are very high. And high taxes will slow domestic spending as available house hold incomes dwindle. Lowering interest rates just creates more debt, inflating asset values, and more bubbles which will trap tax payers in an ever increasing tax burden lowering their ability to spend on other things. We are seeing the exact same thing with China. And given China's political structure, China's economic decline will be worse than just a lost decade or two.
TLDR is run by socialists. They tune out when their bad idea's face consequences. Socialism can be pretty easily summed up on a war against consequence. Doesn't matter what the situation social economic etc. When you aggressively fight consequence you dam up all your problems and eventually the dam breaks.
Cause the market doesn't lie. When people learn about even stocks they realise something that's been building for 20 years suddenly "pop" at the exact time it's almost supposed to pop almost reaching a high point. Suddenly a news narrative comes in just bang on time to explain it. Makes them question it's almost like it was "supposed" to happen. The news lies. They feed you a narrative at certain times. By the time you notice it's already too late while with bubbles and market it paints a pictures as it goes on which allows you to interpret.
Japan's taxes are high? How do you work that out? For a developed country, Japan's taxes are relatively low. And if high taxes are so negative on growth, how come Denmark's GDP per capita is so much larger than Japan's?
@@apsoypike1956 Sorry, Denmark has never had low taxes. None of the Nordics have. Yes, I agree how you spend it is important and Japan spend theirs incredibly badly. It's just that the rate of taxation is totally irrelevant to long term growth. High taxation well spent, for instance to increase productivity, can lead to increased growth. Redistribution can lead to higher consumer spending.
@@bugsygoo Taxes are not the only factor of course. But GDP/capita is a poor indicator of impact on individuals. GDP is derived from overall productive performance of a nation. If you're population is relatively small, then your per capita average will look high. Denmark has a little under 6M people. Japan has 125M people. Different problems.
Becoming next Japan has a long way to go. As a Chinese, I was only expecting that we can catch up with S Korea in terms of most industry technological power in 10 years, such as in Ship building, Automobile, Electronic devices, Appliances, Chemical engineering, and Semiconductors.
除了高阶半导体之外已经超过日韩了❤
only possible if you get rid of the CCP otherwise you're going to spend those 10 years in wars and starvation.
The per capita wealth has a long way to go too. In Japan, every corner, even rural areas, look clean and well-maintained.
@@wedmundsby that definition US is a third world country. Go look at Paris, known to be a city of rats.
By the way I’m not bashing US or Europe but just showing how gullible your logic is
Did TLDR just (intentionally) forget to mention the PLAZA ACCORD? After spending like 1/3 of the video talking about Japan that is.
Excellent video-truly Telling & Informative.
5-6% growth is much better than high inflation and recession in most western countries.
china doesn't have 5-6 % growth
@@arabinchina7794 china has 5-6% economic growth rate the same way I have 5 private jets.
@@schloops8473
You talk louder than world Bank report.
Get a brain,!!!
Thank you very much Mr. Roboto
Truly a bruh moment for China
Bruh
Bruh
Bruh
Bruh
布鲁赫
Great video!
The reason that they are in a real-estate bubble to was because they used public work infrasturcture and land-lease finance to stave off the the effect of 2008 financial crisis to begin with. They are overlveraged on all level of government and its now reaching into the banking sector to gurrentee liquidity for the public sevices. There is a reason people in some key regional financial institution can't take out their saving, because even small amount of withdraw could precipitate liquidity crisis. In fact, they had action quantitated easing since locked down ended and that had not caused inflation years on year.
If China want to lower economic risk for their people, they should establish viable social security system (like state-guaranteed pensions or disability living allowances) instead of just pumping money into some ego or corrupt-driven projects.
I really wonder where all that communist stuff went to. Don't they do any welfare there anymore?
@@TheBoobanthey literally pulled 90% of their population out of abject poverty, and used it to fund public infrastructure (ports, subways, rail, roads) and science to now lead the world in renewable energy and EVs. That’s what happened.
@@TheBoobanwhat did the West do with all its money? Why are there homeless people everywhere? And why are there so many people in America’s prisons?
It's almost like communism is a deadend lie used by the elite to enrich themselves at the people's expense...
No they shouldn’t. The US has social security and it caused a birthrate crash. Instead of childless old people being destitute and elderly who had many kids being loved and cared for, they promoted people be selfish and spend their potential retirement savings on handbags and SUVs when they were young, then they promoted never having children and now my generation is expected to pay for those old people. They’re bad for the economy and didn’t produce any new humans to help spur the economy
Should have used Polymatter’s China in Focus as CTA.
I don’t ever remember Japan dynamiting entire ghost cities during their recession.
There were zombie buildings here and there. But Japan is a lot smaller than China. China has ghost cities, Japan has zombie corporations. China desperately wants population growth and sees Sinification of inner Mongolia and Xinjiang as a way to achieve it.
Japan will not entertain any methods of population growth (easiest is a controlled and steady legal immigration, but immigrants hate getting harrased by racist cops and shook down by protection rackets, and it is a thing in Japan)
Another giant problem with China is the over reliance on book cooking. China has always been many percent over what is even statistically possible growth wise. Even during lock downs their unemployment for a country of a billion people was literally impossibly low. Investors now see this and the world now sees the dangers of putting all thier eggs in a manufacturing basket. I meanvthe likes of apple are already looking for the next indentured servant population to build iPhone. So the collapse is unavoidable. The Chinese where used and abused like the cheap expendable labor they sold them selves as but the party is over for them now and it's back to the fields.
哈哈😊，你开心就好，你们的脑回路真让人担心
Do you think China can still only produce clothes, shoes, toys and assembled electronic products?
@@gzkony Don't think the original poster said that. China labor market is shirking because investors are diversifying from an unstable country. All those unskilled workers without a job are going to affect China economy in a big way.
a) Apple has already struggled to gain a foothold in India. Companies on their supply chain who they have persuaded have already reported loss since their move to India. Foxconn, Foxlink and Winstron for examples have all been met with disastrous results. Western nations already tried investing in ASEAN countries back in the 1990s, which caused the 97 Financial Crisis. So I would probably not see that as a certainty just yet.
And even if Western companies decides never to return. Do you think the Chinese Gen Z will just give up?
b) China is currently experiencing a massive transition into the tertiary industry - rather than being the factory of the world that produce products for Western brands, Chinese businesses are now taking over the production capacity to produce their own products. There will soon be a torrent of Chinese-made EVs to hit the European market in the coming 6 months. So yeah, TikTok, Huawei and DJI were only the vanguard of this transition. Soon, more companies will follow to cover more industries.
No one could ever dream of Japanese companies like Sony, Toyota or Korean companies like Samsung or LG ever being able to become household names in the West but that's actually the norm not the exception. Just because you don't like the way the government run things do not make the least bit of difference.
The truth is that it has always been the CCP's plan to move around from the Primary and Secondary sector once the country get rich enough to move into service and intellectual industries. The real stagnation was when China's economy was being complacent on that it already has. Now, the real challenge comes. And with all risks come opportunities.
@@BatCountryAdventuresHuawei, BYD and Tiktok are hyped up non-critical tech that relies heavily on government subsidies. CCP have nothing to offer aside from being cheap or getting free money someway out of it. Its not sustainable.
2023: Japan’s economy is growing again and deflation is done
"deflation sounds good if your country is struggling with inflation". Yeah, I agree. I would like inflation to stop growing. If not deflation, an inflation rate of 0% does sounds nice here in Argentina.
Yeah, but the macroeconomic situation becomes WEIRD when that happens. The Great Depression was a period of intense deflation btw. Deflation occured as well as in the panic of 1873 which was called the "Great Depression" before the one in the 1930s hit.
Deflation is sign shit's reallyyyy bad.
There is a bg difference between Japan then and the PRC/CCP now - mainly Japan did not go out of their way to antagonize their customers, or engage in "wolf warrior" diplomacy, have random crackdowns, and generally be abusive towards those who would buy their products or invest in their country.
also, they had democracy which avoids perpetual horrible and clueless dictators
The Chinese situation is a lot more dire than the Japanese, and the most significant reason for that is lack of education (especially relative to population size) affecting so many aspects it deserves a 500+ page study annually.
The second largest reason is lack of Chinese access to any form of savings besides housing, while Japanese have a high rate of ownerships in stocks/bonds/futures.
No their situation is dire because of all the attacks from US and its Allies. They get hit on so many fronts.
Not sure what you mean about lack of education. They have way too many college grads each year, especially in STEM area. They are now filing for most patents, writing most academic papers.
I don't think China can become like Japan since in the 90s Japan was already a fully developed country, China even now is still not, so it will be very different for them. They failed to "get rich before they got old".
Japan was already rich when it became old. China will grow old without becoming rich.
Japan vs China. The wealth gap between Japanese middle income earner and lowest earner is very narrow, but in China the wealth gap is vast. Improvement of Japanese economy raised living conditions of the ordinary Japanese but in China, a labour is just a month away to be downed in poverty, therefore China can't be Japan, they may have same economy conditions but living standard will be totally different.
The average wages of the typical Chinese citizen has ALSO been tripled in a decade and a half. The main difference between Japan's rise and China's rise are: Scale! China is 14 times as large as Japan was. Japan was an enforced ally with the biggest economy in the world that they could easily sell to (think Sony, Panasonic, Toyota and Honda) while China isn't. Japan had already semi industrialized before WW2 so they had an established base, while China started from a much lower base after the cultural revolution and Mao did the best thing he ever did for China, which was dying.
@@tallest4evathat's false for most Chinese, especially rural ones who live on less than $300 USD a month
China literally took the most people out of poverty
@@tallest4evathe biggest lie in this paragraph is Mao did good things for China’s economy.
Wealth gap is a positive. Countries with low wealth gap are dying socities.
10:55 "Worst aviation accident in history" *Immediately shows the twin towers*
Close to 0 inflation and above 5% growth. How is this bad?
Because they consume too much copium.
Dang. USA can’t really stop winning.
We just lose less
shouting "Winner!!!!!!" while paying $400 for an insulin
@@vladimirbazhaev7851 When someone has a argument about America : HEALTHCARE CHECKMATE
@@vladimirbazhaev7851 dude you are gonna get drafted stfu
until now, US have never managed to defeat Communist China, neither in military conflict like Korean war, nor in trade war,
1:55
Using that Lenin quote to describe the Japanese as communists because the US is crappy at competing is just so absurd.
And typical American
tariff moment
Americans can't control their jealousy.
@@BN.ja05 bit of a generalization, mate
@@2goober4u It comes with being the undisputed world hegemon, the British Empire handled things similarly.
Two major differences between China and Japan:
1. Japan became a First world country, with a GDP per capita at the time even higher than most developed nations, making Japanese people very very rich (not so much now, but still they are first world), while China has had exponential growth, but because of its massive population, it is still nowhere near a First World country. China tries to show very modern cities and make it seem like that is most of China, but the reality is very far from the truth, the truth is that China is still mostly a country with mostly a poor population.
2. Japan was a full and free democracy at the time, with respect for human and civil rights, and even now, but China is a full blown dictatorship that tortures dissidents, and harvest their organs.
I never heard of organ harvesting practice by China and thought that you were just demonizing CCP.
Then I googled. HOLY SHIT
@@m1nekji165learn where you take your source too.. U know westerner using sinophobia strategies for very long time..
True. China has potential (like any other country in the world) but for that potential to be unleashed, CCP must go. A good example of that is Taiwan -- it is what China could be without the CCP.
Waffle
@@Besthinktwiceno, no it isn't. That's just a lie. Taiwan industrialized decades before china opened up, together with Korea and Singapore. It was the Asian Tigers' model that china sought to replicate with it's special economic zones that brought prosperity to China.
China grew 6.3 % this q2 2023 which is the world highest and you suddenlt speak about China stagnation? You deserved the most honorable Gordon Chang medal
ソ連を知ってしますか？
Do you believe China’s statistics are accurate?
US: "I pray very hard that China will become the next Japan."
but it will probably remain a mao dictatorship where people starve and have no rights and no future
There's one big difference between China and Japan; China didn't allow the US to sabotage their economy to continue trade relations.
Correction: Richard Koo is NOT Japanese-American.
"Deflation is bad because it scares economists"... and probably Ayn Rand, but neither of these things seem like a reason to strive not to become the next Japan.
People really not to stop being so god damn binary. It's not "let's be Japan" or "let's stay poor", there are other paths there. One country could possibly surpass Japan if they follow a more sustainable economic practice (like not lending excessively to support domestic businesses).
Authoritarian society controlled their population growth forcefully. It created demographic catastrophe. Indian approach was that we will focus on reproductive education and other methods. People got educated and now we have fertility rate at 2.1. Democracy didn't allow control of population forcefully.
In short,
The nature of system matters.
there is no reproductive education in India, Many people still aren't educated. I am also an India.
It's not just that. The CCP been cracking down on many companies in certain industry, making it too unpredictable for some and companies started leaving. Besides that, the wages in china increased to the point it's no longer the best option.
most efficient command economy:
@@2goober4u
China is not even the slightest bit of a command economy.
Yes, India is a super democratic power, and China should learn from India? India is the only big country capable of surpassing the United States. China has collapsed and won't accept any debate.
The "official" numbers on GDP coming out of China are overstated. There is no way possible China currently has a positive GDP growth rate.
Not a china supporter and still I find this is the weakest possible argument against china
This is what everyone says but nothing is happening in China, do you know why? Because its all a lie, anti-China haters spending 24/7 spreading lies about China will soon collapse. For the past 60 years, the China collapse theory has always been around, sometimes its on their governance, sometimes its on their system, sometimes its on population growth, and sometimes its on economics, but to date, its all wishful thinking. Keep telling yourself it overstated is just making yourself feel better, there is no way some yellow people can surpass us, they are not even free, right? lol
@@twood2032 I don't like authoritarian rule.
Japan is better than China
of course because you say so
@@逐鹿2024 no. Because your housing bubble which was responsible for over 20% of the growth is popping and because china decided it wanted to be the enemy of it's main customers and it has too much debt for it's actual gdp.
I love Jack's narrations! He's VERY well spoken he dosent ram through the dialog and can be clearly understood!!!
But the biggest problem is the population issue that Japan had as well in the 80s and 90s where they have a very unbalanced aging population. With a whole lot of order people and not many younger people and those younger people not having enough babies. Thjis is really the major issue with China and they have already tried to throw money at it and it failed for the most part.
No, i don't think the population crisis was the main reason for Japan's economic stagnation. South korea also had similar population crisis, but south Korea's growth still remains strong
@@Muhammad_Ahmad_ yah but aging population fast is a very important downwards vector for countries that have to work to gain money, unlike for joke countries with oil in the ground where they don't work anyway. Doesn't mean you'll end up going down but it pushes that way.
Where can I watch the full Nato summit interview you showed at the end?
The U.S was a key contributor to Japan's economic woes simply out of fear that Japan would overtake it. Now, the U.S is trying to do the same thing with China, placing sanctions and technological restrictions on China in an attempt to stay ahead of the competition. Instead of the U.S to improve when facing competition, it resorts to breaking the competitor through unethical means
Wasn’t Nazi Germany the second largest economy right before the war? Always seems like “something” happens before a country can overtake the US
Its the little nation character!!! I've missed them
Demography hit Japan hard. Debt was bad too… Debt is crushing China. Bad demography is now going to hit harder. But policy will hurt the most:
A CCP that made mistakes in a China that was too powerful to fail, can pretend like its decisions were not that bad. The CCP could do no wrong while the economy continued to improve. But as the economy stops growing, China won’t adapt the same way Japan did. Instead of decline, Japan has managed to maintain stagnation while its workforce shrank. China also creates policy based on ideology rather than off the market. Japan can adjust easier, and admit its mistakes quicker. Xi is now President for Life. He will not, or cannot, admit his mistakes. Authoritarian leaders fall if they look weak, so they just double down in hopes that sooner or later, their idea works. So he’ll make fiscal mistakes, then won’t adjust those decisions afterwards, and China is going to decline. His policy has also been more anti-Western, which has pushed foreign markets and investment away from China, and more leave every year for cheaper labor or controlling policies or public discontent with Uyghur genocide or any other number of reasons to leave China right now. No one wants to be the next foreigner arrested randomly as a political prisoner because some executive of Huawei got arrested in your home company. That genie is out of the bottle now and isn’t going back in.
Tell us you are biased and clueless without telling us.
Anyone who uses the word genocide on Xinjiang is just brainwashed at this point. I don’t care if you accuse China of forced assimilation or whatever but if you don’t know what genocide means then google it first. US has been throwing that term out as propaganda. If China truly has a genocide campaign you don’t think the Arab world would go crazy? Arabs aren’t afraid to standup to US the most powerful military in the world.
Anyone who has an ounce of intelligence knows it’s a BS propaganda.
6:21 It seems like at least four of the features mention here are present in Sweden (debt-fueled property bubble, export driven economy, weakened consumer demand and ageing population). Do you think the Swedish economy could also follow a similar path to Japan/China soon?
shows to me that eternal growth isn't a real factor for a successful and stabile economy (in case of Japan)
Could you do an Asia specific section?
"It already has. You just can't see it" - Darth Maul
Oh who am I kidding, of course you can see it.
Richard Koo is Taiwanese American born in Japan.
Any Canadians out there seeing some interesting parallels with Japan after watching this? Or is it just me.
As some who hates canada, I will say that Canada is petty safe. Infact it is poised to thrive in the next 20 years. Eventhough I resent that fact.
Your perception is just that of your own country, everybody thinks their country is doing bad till they see somewhere that's doing worse, look at statistics compiled by reliable institutions and you'll get a better idea.
@@chinguunerdenebadrakh7022 I live over an hour from any major cities, and yet even in the small town where I live the housing prices are now over $1 million, with many being between $1.4M and $1.9M. Inflation is high, costs are high and if you want to talk about statistics Canadians have the highest person debt rates in the G7 and household debt is at 187 per cent of disposable income. $59,300 is the average Canadian income, try buying a million plus dollar house on that, even as two income house hold and being able to afford food and insane gas prices thanks to endless carbon taxes. The grass my not be greener else where, but it sure is yellow and dying here.
@@Balorian Okay, let's talk inflation first because that's the easiest. Inflation is hard to deal with, but how is it relevant here? The point you raised was parallels with Japan, Japan didn't have high inflation prior to the early 90s when their bubble burst. And Japan's been in a severe threat of deflation ever since.
And housing prices? That's more local regulations than any macroeconomic indicator of if the country's gonna shit their pants. If you zone entire areas near some of the most productive cities in your country for "single family housing", it's obviously going to be tough to have enough housing for everyone.
Japan did not in the 90s and does not in the present have any such issue (of land regulation) because their developers can build relatively freely (and their housing prices are also affected by earthquake regulations which lowers house prices over years (because you might be required to do upgrades that bring the cost up to near parity with new housing) but that's beside the point and a very Japanese problem).
Japan's property price boomed because 1) there was expectation their economy would keep skyrocketing, so it was valuable to invest in such properties 2) the underlying factor behind it was the insane postwar recovery of Japan's economy which was fueled by governments giving for-profit banks quotas to lend to "strategic industries", it worked well enough till it didn't because it contributed to the bubble by creating inefficiencies and oversupply of credit in the market.
There's no similar expectation for Canada, investors probably expect Canada to grow 2-4% annually for the next 30 years. And considering how little Canadian banks were affected by 2008 (so much so it became a case study), I'd say credit oversupply and bad loans aren't that big of a problem as well.
감사합니다.
China's future is much worse than Japan's. Japan has stagnated into one of the most prosperous, wealthy, democratic countries in the world. Japan is allied with the most powerful country in the world the USA. There is an argument to be made that Japan is the USA's closest ally. The shortcomings of Japan's system and fallout from their economic stagnation is mitigated by the fact that they can depend on the US to help them. China used its economic might to line the pockets of the elite and plunge their nation into an authoritarian cult of personality. China has essentially no friends except maybe Russia who is not long for this world. China will likely cease to exist in its current form in the near future. The CCP is not designed to hold things together when things aren't going well. We will likely see the collapse of the chinese system and the country likely break apart into several smaller nations. It has happened several times in China's past.
Plus Japan has anime
Yeah I don't expect that another set of "five year plans" and "great steps forward" can fix china. Actually they are in the trouble they are because of these actions. So doing even more is like digging deeper to try to dig yourself out of a 90feet deep hole.
this year South Korea begins to have commercial deficit face to China,
the last and most important industry of Japan, automobile, will be taken over by the Chinese companies in nect decades,
in aeronautic and aerospace, both SK and Japan are backward comparing to China,in 2023 Japan has already 3 spatial failure,
so as long as China get richer, SK and Japan will get poorer,
when you go to a European Smartphone maket, Sony don't exist anymore, neither LG, yhe only Korean brand is Samsung
but we see so many Chinese brands: Xiaomi, Honor OnePlus, Oppo, Vivo,
China is not a vassal under US military occupation, long befote existence of US and theit Germanic tribe ancestors,
China has already traded with Roman Empire with enormous commercial benefits,
basically, US has tried all means but still unable to defeat China in a trade war,
so the only thing can do is to repeat: China will collapse, China wil collapse...
@@ihmpallgood one
This might be the worst and unintentionally funniest take I've seen on the Japanese economy. You weebs really are something.
It's a stupid question. I hate publishers who use questions for titles, especially when they cannot give definitive answers.
Sounds like a problem Australia could fall into as well, the amount of household debt is scary here
but it is quiet different
@@kevinvkluger2652 it is, and would be very different but the idea that it was caused by a fall in asset prices, that's scary if you look at how high they have gone in Australia
30% of China's GDP is a housing bubble.
Never in history has anything remotely similar happened.
Australia doesn't have rapid declining population grown or shortage of resources on the contrary it is one of the few countries which has the best environment for growth in coming years
We have just signed an FTA with India whose economy is growing at 8%.
Answer is Yes, its already happening.
Will China become the Next Japan? Sort of but also the circumstances are very different. The video mentioned China has or can learn from mistakes in Japan but what wasn't mentioned is that China's GDP per capita is roughly 1/3 of what Japan was when it began it's crisis. That means Chinese labor is still very cheap relative to the high labor costs of Japan. The higer the GDP per capita and higher labor wages, the less room for further growth. China still has a lot of room for growth opportunities just based on their low wages. That's why economist are estimating around 3% annual growth over next 20 years for China and not the 0-1% growth that Japan had since the early 90's.
But to add historical context, when Japan was China's GDP per capita in the 60's, Japan would have 6-7% annual growth for the next 25-30 years! China is going to have 3% annual growth and that's a massive difference and why China isn't going to join the upper income nations anytime in the next few decades.
Yes, China may still have some room to grow but their debt and aging population worries me.
growth is unsustainable when your population is aging extremely quickly, customers are running from your hatred towards them and all the engines of the fake gdp growth are busted such as housing. And well, when your gdp numbers have always been a lie, then following growth numbers are a joke too.
Wish you would cover Michael Pettis and Matthew Klein's views on this.
China’s corruption level is only matched by Russia and Zimbabwe, therefore a bit of inflation is likely since people keep not receiving enough public money. However, the trend (despite China’s ridiculous lies of economic growth and tenfold GDP) seems to point towards stagnation … and the bad news is that Western economy depends on China’s, just as China’s depends on ours.
let's rip that bandage off. We should never depend on criminal ethno-dictatorships that hate us and steal from us.
It was not the correction in stock prices and home prices to levels, people would buy at, Japan did not recover from. It was the investment in non-yielding capital, Japan did not recover from.
Offically, South Korea is not supplying Ukraine with artillery shells. I'm not saying 100% they are not but no one outside of a handleful can say for sure that SK is giving Ukraine artillery shells.
I think he was focusing on manufacturing rather than direct aid. If SK manufactures components that are used in the shells, then the supply lines run through SK.
Korea sends the shells to US storage, so US can send American shells to Ukraine.
It’s basically, America doesn’t like having zero shells (what if something else happened somewhere else around the world) and so this way Americans can have their guns for emotional support, but also send them to Ukraine.
1:40 "THEY TOOK OUR JERBS!"
Let's compare Japanese and Chinese history. The Japanese didn't want Europeans to land on their island.
They knew about the Dark Ages diseases. The British wanted to conquer Japan, so they began to cannonade
cities along the shore. That Japanese relented and sign trade agreements. Japan was also used by the United States so Americans could be the first self-declared nuclear super-power. When the British were attacking
Japan, England and other countries attacked China, but China won. That was when the English were saying it
was legal for them to attack China and India, so they could trade tea from India for opium from China.
The Victorian era in England is known as the opium era. Japan created an international trade war with America, what is the third world war, winning it, China with other Asian nations joined in.
I'd be asking will the United States become the next England, a failed empire.
What Britain did with colonisation was wrong but in the end their smaller form is better in my opinion because it’s more moral, not wrong.
@@eawproductions the only reason britain is so rich is because of their colonisation in the past , a country like that will never become what it is today and also the present situation in UK is fuxked up , rents are through the roof
@@eawproductions The only reason you can say Britain had a smaller form of empire building is because they used ocean going boats and cannons, not atom bombs. If you were Scottish you wouldn't think the British were moral at all, as government and as a people. It took a British slave trader to write "Amazing Grace". That says it all.
I take issue with the deflation statement. It is *rapid* deflation, just as rapid inflation, that causes issues. A deflationary cycle of 1% per year bothers no one, just as a 1% inflationary cycle goes unnoticed. It is when it gets past 5% that it starts to become problematic. The reason people don't like deflation is that it hurts borrowers and merchants and manufacturers. A stronger currency means its harder to pay off the loan because the loan becomes "worth more" and if wages start to decline, you get the idea. At the same time, the stock in any given store loses value while it sits on the shelf because it takes less money to buy it.
INflation, on the other hand, hurts lenders and savers. A bank loan becomes less valuable as the "worth" of that loan decreases because the value of the currency is decreasing. Simultaneously, anyone with a savings account is losing money because the rate of inflation exceeds the rate of return. Add to this that, if to try to retain employees, businesses start raising salaries (which raises their product prices at the same time), then it will be that consumers can pay back their debts more easily, because fixed rate debt such as mortgages and auto loans become a lower percentage of their monthly income.
Now, for both of these, there are also impacts on exports and imports that get rather complicated when you factor in exchange rates and policies of the trading partners that get into "strong dollar vs weak dollar" arguments which are also mostly bogus arguments made by people who have seemingly no understanding of economics beyond a jr high school level. (I'm looking at you, Janet Yellen.) Their analysis is based mostly on pre-conceived notions they acquired in school, not from their own study because most of them don't want those preconceived notions broken. Most of then stop learning when they leave school because they can't tolerate the real world not lining up with what they were taught.
The dirty little secret in all of this is that governments hate deflation because it reduces tax takings as wages and the cost of goods decline. That's why governments don't like it. Deflation is not a bad thing. It is just misunderstood because there's an inherent bias against it, rather than an interest in understanding it and evaluating its impact.
Fiscal "stimulus" is also something that people take for granted these days for precisely the same reason. It relies on what is called the "wealth effect" which, when you examine it over the longer term, say two or three years, rather than just a few months, turns out to be complete garbage. Economics is complicated and most economists (like Alan Greenspan did after he retired, and the guy I hold in no small part responsible for the 2008 crash) will tell you that, when it comes right down to it, honestly, they're just guessing. An educated guess, sure, but still just a guess.
China is now in much worse condition than Japan in 1990. The real estate bubble is more severe, the population is already in decline, much less technological development, no quality ethic, the country and people are much less wealthy, pollution, water shortages, corruption, no rule of law, and the tyrannical government will try to prolong the bubble (and other distortions) instead of letting it pop. Lost decades are the BEST that China can hope for.
No, China forsaw this and popped the real estate bubble on purpose 2 years ago. They always try to self-correct before a massive crisis occurs.
@@zadaw7220 Too late. China already has multiple massive crises: debt, housing bubble, pollution, population crash, etc. All courtesy of CCP.
China has been "about to collapse" for 40 years now. You are definitely old enough to remember that
@@J_X999 I haven't been talking about the collapse of China for more than about 2 years, and my time scale is sometime this decade. The earliest prediction I'm aware of is Gordon Chang's book from about 20 years ago. He was off in his timing.
@@dzcav3 Yep, that's literally my point dude. People are constantly predicting the collapse of China within the frame of a decade. When that prediction inevitably fails, they just push it on to the next decade. Gordon was wrong about his prediction 20 years ago. Yet he's still going and people blindly believe him to this day.
Zeihan's the new boy on the block. He predicted the collapse of China for the 2010s, but now he's doing exactly what I said he'd do and he's pushed the prediction into the 2020s.
Every time this happens, people are convinced it's going to happen. "It hasn't happened like we said for the last 4 generations, but this time will be different, this time it's actually happening 🥺"
I don’t think they can. They’re stuck in the middle income trap. Japan became rich, and attained high income status before stagnating in the 90s.
Yes. And it’s already decreasing in count as of this year. Going below a billion, like Japan below 100 million will be a sobering thing to witness, as it’s a decline many nations never experienced, and some who did, hasn’t since a major famine, genocide, or plague/smallpox pandemic
Their economies will have long term decline, possibly until another era of population growth
I’m very doubtful about any more population growth since younger people will have a less likely chance with each succeeding generations to have children or get married.
There’s a lot of different factors were younger generations are less likely to have children since there’s a lot of conditions, you have to examine.
no but germany's france and the uk all have.
The issue is CCP is hugely egotistical so why they’re worried, I doubt they actually think they could suffer the same as the Japanese
also, as in all dictatorships, everybody sends bogus data upwards because failing to reach a target is bad enough... pushing real data about failures upwards is a crime.
@@schloops8473this is assuming leadership doesn’t care about statistics which would contradict their meritocracy.
Most of their senior leaderships are engineers, unlike US leadership that is typically career politicians. Who do you think would choose to be more pragmatic? Engineers or politicians?
I’m not arguing for which system is superior but I find it amazing how uneducated your opinions are. It’s like full of your personal feeling and emotion towards ideology rather than look at it objectively and using logic
all that is very nice. Now a dose of reality: engineers are useless when they have to refuse truth for the idiotic ideology and propanganda and corruption of the idiotic dictatorship. @@dailyrant4068
The big difference between Japan and China is that China gets old and the economy stalls before the people get rich. Japan ranked second in the world in terms of overall GDP and GDP per capita. In the case of China, the per capita is still low and the gap is large, and if there is no economic growth of more than 5% every year, China will not be able to maintain the employment of its people.
That’s not how growth and employment works.
But yes Japan is far richer per capita than China
This Channel is like: why the whole world is crumbling execept for the us ( we are the best country world).
This idea that a Economy can keep growing and growing it’s stupid that’s impossible, every economy has up and downs like everything in life…
Crazy to think the US was so bitter about Japan's economy outpacing them, when they're arguably their closest ally.
It wasn't outpacing them, it was crippling the US working class and causing deindustrialization of the rustbelt. Japan wiped out the American midwest. It's why detroit became detroit.
That’s only natural, as Japanese manufacturing also goes downhill. Chinas manufacturing also gets replaced by cheaper alternatives in many areas. US simply isn’t competitive at manufacturing
In the 15 year period they'll blame India and Vietnam the same way.
knowing what happened to Japan helps them with nothing .... ccp knew about the demographic crisis looming since the 90's yet did nothing for 2 decades .
I’ve been hearing this for at least the last 20 years 🤦🏽♂️
Denial stage
As far as the media is concerned shouldn't have china's economy been wiped out due to the housing market bubble?
CCP will never collapse as they will not announce it just like North Korea. Their save face policy will not allow it.
It no doubt is, just that the books have been cooked enough to stave the inevitable.
in the real world, yes. In the CCP's world, the upwards layers gave GDP targets to the lower levels and those have to push bogus data up or they'll get arrested.
@@advancetotabletop5328clearly you have no understanding of either economics or accounting. You can’t just magically cook a book and turn it into real things. They can’t possibly just make up numbers.
It’s ok, we know you have some personal hatred for China and makes you say stupid comments publicly
Becoming the next Japan would be a huge step up for China
Yep but they are't fully developed, nowhere near and that is even less likely to happen now.
@@loot6 exactly, facing stagnation when the gdp/cap is $30k is very different from being stuck at $12k
@@jzzzxxx You'd be surprised how many people don't know or think that. A lot of people seem to be trying to push that even, that China will just end up like Japan and "be ok" but in fact while it's very similar, it's not the same at all.
So high inflation is not good, low inflation is not good, 0% inflation is not good and deflation is also not good. Got it. Understood.
*Shrugs
*Causes exflation
Another 'China's going to collapse'. Come on man
He never said it would collapse, just that it may going down Japan's path
@@priestofronaldalt Stop being obtuse
When "The Economy" stagnates, it leads to falling prices and then transactions come back. Macro is just he sum of micro and micro agents hall have different price at which they transact. Stagnation is necessary after booms when everyone bought at the same time. The boom was the calamity. Not the correction.
Unlike japan in the early 90s, china still has many of the headwinds that create the middle income trap. This could actually end up a lot more severe as a result. Lets hope not.
China is already escaped the middle jncome trap when per capita gdp went over $15000.
@@kth6736 The problems that create the trap don't go away when you stop officially being a middle income country.
I really hope the current situation only stagnates (or not even that). But a economic and political shakeup at this point brings thoughts of 20th century Argentina to mind.
@@TrabberShir I dont understand how can a high income country fall into the middle income trap.
Argentina is the exact opposite of china. Too much populism. China does zero populism.
@@kth6736 In the first 30 years of the 20th century, Argentina went from being one of the poorer former Spanish colonies to being, by some measures, the 5th richest country in the world. That all ended with the start of the great depression.
How much of Argentina's failure to truly recover from the depression is political versus economic is very much an active academic debate.
@@kth6736 china's gdp numbers are a joke
On the one hand yes because 30 years w/ no growth.on the other hand no, because japan has friends and people like it.
I forgot that Donald Trump existed before 2016.
I wonder how each country would fare today if, suddenly, they had no access to other countries and anything outside of their current territory (as defined by international law). Which would suffer and be set back the most and longest? Which would actually prosper? Which would break up into smaller states?
When TLDR talks about economy, it does it in a irritatingly conservative way.
It should be clear as the sun that traditional economic theory cannot explain current situations and it CERTAINLY CANNOT find solutions to current crises.
Our overpopulated, environmentally compromised world, has no room for traditional expansionist measures.
Hopefully
Every time I hear stories of recessions, I always return to the same question: why does it matter if the economy stops growing?
If everyone's taken care of, why does it matter that the money numbers aren't getting bigger? If everyone's not taken care of, why is the economy the priority rather than the people? What's the economy growing for? If it's to build a safety net, then shouldn't stagnation be fine?
Why is an economy coasting along a bad thing?
Because old people don't produce but drain money. Too many old people means not enough money. If populations stagnated at a healthy proportion old to young people, that would be fine but old people are making up more and more of the population.
@@only_fair23 If it did, that would be perfect. So, minor growth would be good in the short term, as long as we stagnate soon after, right? Our planet's resources are already crumbling under the last population boom, so more growth would hasten draining oil reserves, drying rivers, food shortages, wildfires, ultimately creating a much worse fallout. No matter what, economies are gonna turn towards a continual shrink, and the sooner we accept that, the less severe the whiplash will be.
In other words, stagnation would have been fine, but we're already well over capacity for how our systems work. Either we push to make better use of what we got right, reduce the number of consumers, or load up the powder keg further with more growth.
@@Tralfazz74 We're not stagnating at a healthy proportion. If things continue like this, old people will make up the majority of the population which is a problem as old people can't work
@@only_fair23 I wonder what's gonna break... The majority of work that employed large amounts of people are or can be done with automation, or by a small number of people with machines. Relative to the number of working-age people, there isn't much work that needs to be done which benefits people. It's common practice in lots of big businesses to invent jobs simply to bolster your company's rep with employee numbers--a pretty roundabout way to give someone the money they need.
I have lots of family who are or have been in the US military. Every single one of them has a laundry list of stories where the Army spent ungodly amounts of money because they could: Once, they took 12 privates out onto a base and fired numerous $50,000 howitzer rounds to "flex America's strength on the recruits". $800,000 to flex on 12 people. Another time, an officer was talking to my cousin about his time in Afghanistan-- he mentioned that they would drive empty caravans through unpopulated areas because, and I quote, "The military gives us a certain amount of money each quarter. If it looks like we spent it all, then we can ask for more next year."
Most our labor is automated, and a large part of what isn't is on it's way out.
We certainly don't have a shortage of money, so jobs that exist just to grow the economy are basically filler to make big number go bigger. Our country can afford to pay everyone a living wage, but chooses to dump hundreds of billions onto military hardware they never plan to use.
If it's a problem of old people not contributing or needing care, the US can afford to pay caretakers great salaries and take care of large sums of their medical bills, no question. The USA COULD do that, but as long as companies prioritize money and the country demands GDP growth even in bad times, that money will never go to the people who are working or in need.
Honestly, if the government just diverted money from the military to healthcare, it would still count as GDP. They could keep their big number while also helping regular Americans.
You may have guessed, but I'm an US of American. I don't know where you're from, or how relatable this is.
Most jobs cannot be automated, I don’t know exactly which ones your thinking of but automation replacing everyone idea is hugely overstated. As for switching from military spending to giving everyone a wage is that if people aren’t producing anything, then there’s gonna be a supply shortage and then inflation will skyrocket, as people will have more money to spend on less stuff. As for the greater point about how most jobs don’t help people, do you not consume stuff? Would you be willing to give up every amenity in your life? Give me an example of a job that doesn’t benefit anyone.
Why dont you talk about the u.s. economy on how its stagnant it is
Cus its not
Surely, half of Europe, and UK in particular, would be delighted if their economy was just stagnating and they would have to wonder about the future rather than experiencing the struggles in real time. But sure. Let's be concerned about China😉
all of Europe and the UK in particular are richer by far than china and they publish real data contrarily to the joke that are CCP numbers.
one fact ignored is that the total GDP of China is three or four times more than the GDP of Japan. the mainstream media in China always compare the country with America rather than Japan so Japan has never been China's benchmark