Staff Reports
The Chinese are at it again! First, they spread their pesky COVID-19 virus all over the world, causing chaos and death. But fear not, because American ingenuity came to the rescue with Operation Warp Speed. We saved the planet, folks! Now, brace yourselves for the second Chinese contagion – an economic one this time.
China’s economy is collapsing under the weight of decades of poor communist central planning. While the US and the rest of the world are grappling with inflation, China is sinking into the depths of deflation. It’s like a reverse Oprah, with China saying, “You get deflation, you get deflation, everyone gets deflation!”
Don’t just take my word for it, folks. The Wall Street Journal, a reliable source of information, has been all over this China situation. They’re saying that investors are fearing a financial contagion in China. Remember Lehman Brothers? Well, China might be facing its own “Lehman moment,” which could set off a financial crisis even worse than 2008. Yikes!
For years, we’ve been bombarded with predictions of a “China century.” They claimed China would dominate the 21st century, leaving the US in the dust. But guess what? The China bubble has burst, and now experts are scratching their heads, wondering what comes next. Turns out, communism and good economic planning don’t mix. Who would’ve thought?
There are some really excellent longreads out there about China's economic crash and the end of its catch-up growth. But I thought people could use a short simple story, so I wrote one. https://t.co/zBwyEcXECG
— Noah Smith 🐇🇺🇸🇺🇦 (@Noahpinion) August 21, 2023
Let’s not forget the Chinese Communist Party’s failure to convince its own people that their financial future is secure. Beijing can try to rig the economic data all they want, but the truth is that the Chinese economy is tanking. Retail sales are stagnant, inflation is negative, and banks are tightening their purse strings. Even the youth unemployment rate is through the roof. These are not signs of a thriving economy, my friends.
This economic contagion isn’t just about money; it’s also a political mess. If China can’t prove to its own people that they’re capable of taking action in their best interest, then serious trouble lies ahead. Economic stagnation, followed by political instability, could be on the horizon. And guess who gets to deal with the fallout? Yep, the rest of the world, including the good ol’ US of A.
We must remain vigilant and continue to decouple ourselves from China. They may claim to have everything under control, just like they did with the pandemic, but let’s not forget their track record. They failed miserably before, and they could do it again. So, keep an eye on China, folks. This economic contagion is nothing to sneeze at (pun intended).
