Wednesday, 30 August 2017

My prediction: the coming collapse of China’s Ponzi scheme economy | Jake Van Der Kamp | SCMP

One of the many possible outcomes of a collapse of China.  Not predicted by Jake...
Let's pray not!
Letter to a friend
I've got a lot of time for Jake Van Der Kamp of the South China Morning Post.  He was an investment analyst, before he got a column with the Post.  He retired from the Post about five years ago (IIRC) and went back to his native Canada, but apparently couldn't stand the quiet, so he came back a few years ago and got another column, "Jake's view".  He's a contrarian, an iconoclast, often critical of both Hong Kong's government and Beijing's.
Here, in his scarily-named column "The coming collapse of the mainland's Ponzi economy", he addresses the issue you asked about: the possible collapse of China's economy, as a result of its mountain of debt.
I told you earlier I was not plugged in enough to comment on your fear of a possible coming economic collapse in China, and just commented that those who've gone short China in recent decades have been burnt.  Of course, past performance doesn't determine future results….
Jake sees a collapse at some stage.  But — optimistically! — does "not think it will result in the break-up of China". Sure hope not!  Disaster be there. 
Again though, he reckons it will "more likely resemble the Russian emergence from a command economy". If so, God — or the Flying Spaghetti Monster — help us!  Spare us a Chinese version of Russia's kleptocracy. 
Jake reckons the collapse will come "long before 2047", but still I'll be getting on by then; we will likely have sold up our properties here, and invested in an apartment on a permanent cruise, like The World!