Military Review

Following China, the whole world will fall?

Japanese Prime Minister Shinzo Abe reminded the world that China’s economy has become an integral part of the global economy. “We cannot separate the Chinese economy from the world economy,” he explained. Actually, no one doubts that China is a “global factory”. It is another matter that China is in a fever: the Chinese stock exchange is pulling down European and American indices. If the global financial crisis in the 2016 year nevertheless breaks out, then it will begin with China and with a fall in the Chinese demand for oil, which will inevitably affect Russia.

Independent economist Alexander Odintsov explained "On the eve of the"why in 2016 the world might shake a new economic crisis.

In 2014-2015 in China's stock market "speculative bubble inflated." "Shares," reminds the economist, "were bought by the population, including the most unqualified, just like on the eve of the collapse of 1929 in the USA." It is not only the paper market that is in turmoil. China’s economy itself is slowing down, it is undergoing destructive processes characteristic of classical crises in developing economies, Odintsov said. The fall in exports occurs six months in a row, and imports fall - for thirteen months in a row. Gold and foreign exchange reserves decreased (for 2015, from 3,8 to 3,3 trillion dollars). In addition, there has been a massive capital outflow (500 billion for eight months 2015). Finally, the devaluation of the yuan, which began in August 2015, is in reality a currency crisis. “Chinese companies, like Russian, in their time, the expert writes, have rather sharply increased the volume of foreign currency debt, sowing on a“ credit needle ”. In the second quarter of 2015, China’s external debt increased by 63%, from 1,03 to 1,62 trillion. dollars. " The total debt of companies and individuals in the Celestial Empire has already reached 207% of GDP (data for 1 July 2015), and this figure is twice as high as in 2008. The growth of debts creates the risk of bankruptcies. Example: “default” of China Shanshui Cement Group, the largest cement producer, and Baoding Tianwei Group, a generating state company.

To avoid the consequences of the fall of the PRC stock market (with total losses of around 4 trillion dollars) is extremely difficult, the scientist believes. Banks, companies and private investors will suffer.

How can a crisis affect the global economy? Like this:

“Since China is not only a major exporter of the United States and the European Union, but also a significant importer from Germany and the United States, the volume of imports will inevitably fall. Then the volume of countertrade from the EU and the US, which will reduce their imports, may decrease. As a result, the global economy, as in 30-s. XX century, can get into the funnel of depression.

China's economy will inevitably slow down. The world prices for raw materials will fall, which primarily affects the Russian economy, which will cause further devaluation of the ruble to the level of 80-90 depending on the depth of the fall in oil prices (approximate rate = 3500 / price of oil) ... "

True, devaluation refers to the competitive advantages of the Russian economy. “And if you remove from it a policy that systematically destroys a business, a corrupt tax burden and gradually give the ruble emission on the basis of monetization (М2 / GDP) at least 80%, by introducing restrictions on capital transactions, the flow of foreign and domestic investment will be huge, - An economist writes. “In this case, the ruble will strengthen, and the capital will flow.”

Odintsov also recalls the average duration of the modern economic cycle: 7-8 years. Therefore, it is highly likely that a new crisis will occur in the 2016 year (the latter began in the 2008 year).

Thus, a new crisis can begin in China and then shake the entire planet.

The inseparability of the Chinese economy from the world economy was recently stressed by Japanese Prime Minister Shinzo Abe.

In a joint interview with the business newspaper “Nikkei” and “The Financial Times” published last Sunday, he said: “Chinese yuan and stocks fluctuate quite a lot ... Nevertheless, taking into account reforms and openness, China achieved great growth rates and increased the level of involvement in world economy. "

The Japanese Prime Minister noted that the Chinese economy has become an integral part of the entire global economy. "We can not separate the Chinese economy from the world," - quoted the prime minister TASS.

The Chinese economy is not going to separate from the world.

17 January in the media passed the opening of the Asian Infrastructure Investment Bank (ABII) - a real competitor to the World Bank. At the official ceremony, Chinese leader Xi Jinping delivered a speech "Euronews".

The agreement on the creation of the AIIB, the channel reminds, was signed at the end of June 2015. Russia is the third largest bank participant after China and India.

The launch of a new global financial institution in Beijing, comparable in value to the World Bank and the IMF, suggests that China has become an authoritative power on the world market, said Russian Deputy Finance Minister, deputy governor for the AII, Sergei Storchak.

“From this moment on, it can be considered that the initiative that the leadership of the People’s Republic of China has put forward has become a reality. And this reality, according to my feelings, is very comparable to the reality that took place in 1944 in Bretton Woods, when a group of countries decided to establish the IMF and the World Bank, ”Storchak quotes RIA News".

However, the activities of the AIIB will in no way save the world economy from crises. And the Chinese too.

Last Friday, the value of the “Shanghai Composite” (the main stock index of China) fell to 2900,97 points. Bloomberg wrote about this. This figure is even lower than the minimum observed during the downturn in the stock market of Chinese companies last summer. Experts are sure: the global economy will inevitably move to lower growth rates.

"Given the depressing start of 2016 of the year, the decline of the Chinese economy will continue," said "New News" Artyom Deev, Head of Analytical Department of FC AForex. - According to the updated World Bank forecast, China will “slump” to 6,7% by the end of 2016. The situation is exacerbated by the increased risk of a currency war. I am afraid that, given the pace of devaluation of the yuan, the People's Bank of China is doing just that. In the meantime, the main blow falls on commodity economies. ”

Of course, Russia will also get it: its economy is just about raw materials. As Igor Nikolayev, director of the Institute of Strategic Analysis at FBK, noted in an interview with the Noviye Izvestia correspondent, the economic problems of the PRC affect Russia indirectly, but seriously enough.

“In recent years, two thirds of the global increase in demand for oil, including ours, domestic, has been provided by China. Now everything is different, ”said the expert.

* * *

Although the economy of China will not go down (that is, it will show a decline, negative indicators), but it will slow down its growth, characteristic of the Middle Kingdom for several decades, this will immediately affect the entire global economy. In 2016, experts predict a new financial crisis, which will begin with a slowdown in the growth rate of the PRC.

Reducing the energy needs of the “global factory” will inevitably lead to a reduction in demand for oil, and with an oversupply of prices, the price of black gold will simply collapse. Today, the forecasts of some Western financiers about the upcoming oil prices in 10 dollars per barrel do not look surprising.

The fall in oil prices will hit Russia's raw materials economy. The ruble exchange rate will continue to decline, and the prospects for "stabilization" and even "recovery" of the Russian economy, which has recently predicted Vladimir Putin, they will turn into prospects for achieving the next tier of the “bottom”, which, last year, I remember, Minister Ulyukaev liked to argue.

Observed and commented on Oleg Chuvakin
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  1. evgeny1979
    evgeny1979 19 January 2016 06: 42
    -11 qualifying.
    To hell with this China let it fall sick of this consumer goods, around the Chinese.
    1. Shadowcat
      Shadowcat 19 January 2016 06: 51
      The problem is that China has firmly established itself in the electronics market - almost all components of different degrees of integration are produced in it. So if the electronics factory closes, it will be bad. We wave handles to such a not very important production of apples, samsa and other electronic tinsel. Although it touches other parts of the electronic sphere up to the equipment of cell towers.
      By the way, the joke about the "Made in Russia" sticker on a Chinese product is popular not only in certain of our circles, but also in other countries with a changeable accent. I recently spoke with a Taiwanese. I admired their production. At first he was also proud, but after the third he confessed about the stickers.
    2. bandabas
      bandabas 19 January 2016 22: 53
      Russian with Chinese brothers forever. The unity of peoples and races is growing stronger. A simple man straightened his shoulders. A simple man walks with the song, Stalin and Mao are listening to us.
    3. siberalt
      siberalt 20 January 2016 02: 49
      China was attractive to the West for its cheap labor force. The Chinese wanted more, but who will allow them? Actually, all of China is on the Pacific coast and along two rivers flowing into it. All that is to the west is naked. To move to the North - to Russia, and in other directions only Vietnam and India. But it's dangerous there! Remains Russia with corrupt managers from the EP. Cupid has already been sold. The border was along the Chinese wall. And where is she now? China has never been friends with anyone. This is a different civilization. The rest is a political blah blah show.
  2. Alexander 3
    Alexander 3 19 January 2016 06: 42
    All these events once again emphasize the interconnectedness of economies. If everyone in China suffers from a downturn, if sanctions are imposed on Russia, then Russia alone is bad. Russia has seen times worse, but we don’t want this scenario. We will live on evil for our enemies, let them choke.
    1. Nikolay K
      Nikolay K 19 January 2016 12: 06
      A crisis of overproduction in China is inevitable, and in the worst case scenario, it will turn into a global crisis, compared with which the current one will seem a trifle. One thing is good, our economy is already in such a way. . The position that it will not fall so high.
    2. The comment was deleted.
    3. siberalt
      siberalt 20 January 2016 03: 09
      Yes, now all economies are connected in one bundle, so what? Maybe the Internet is to blame? laughing
  3. Shadowcat
    Shadowcat 19 January 2016 06: 48
    The most interesting thing is that the country in conflict with China says this, and seeing the next gestures of the representatives of this country make us think about the cunning Japanese and the straw.
  4. Sars
    Sars 19 January 2016 06: 50
    So far, in Russia, effective managers like Medvedev-Siluanov are in power - with every sneeze of the economy in China or in the states - our economy will have a heart attack.
    1. Vadim237
      Vadim237 19 January 2016 10: 02
      Instead of oil, we’ll start selling drinking water - a barrel of water is already more expensive than a barrel of oil.
    2. Nikolay K
      Nikolay K 19 January 2016 11: 56
      Putin’s most important economist is demand. As for Medvedev, we all saw him, well, what is the demand with the clo. on.
    3. The comment was deleted.
  5. rotmistr60
    rotmistr60 19 January 2016 06: 57
    The United States was to blame for the previous crisis, and everyone knew perfectly well about it, but the West was keeping quiet in a rag. Now all of a sudden, claims to the Chinese economy, which is falling. But it seems to me that this is a deliberate translation of the shooters into a country that has long been across the throat of Americans. 2016 will really show who really is to blame. And the Americans will play an important role in this.
  6. sa-ag
    sa-ag 19 January 2016 07: 23
    Quote: rotmistr60
    The United States was to blame for the previous crisis, and everyone knew perfectly well about it, but the West was keeping quiet in a rag. Now all of a sudden, claims to the Chinese economy, which is falling. But it seems to me that this is a deliberate translation of the shooters into a country that has long been across the throat of the Americans.

    In my opinion, these crises are similar, in 2008 it started because of the non-repayment of mortgage loans that were distributed to almost everyone in a row, in China there was also an increase in production, distribution of loans, the game of the population on the stock exchange, but when the loans had to be repaid, there was a problem , aggravated already on a global scale by the devaluation of the yuan, domestic demand began to fall, so much energy was no longer needed and oil went down
  7. Kaluzhanin
    Kaluzhanin 19 January 2016 11: 02
    Yes, chewed mole! Why is the country's economy assessed on the stock exchange? Why not by how many goods and services the country has produced, but by the electronic numbers of monitors? In our progressive time, the numbers on monitors can change quite easily by hand, if one person created information processing algorithms, entered mathematical formulas into the software, then what prevents from inserting a variable into these formulas, which, if necessary, will be = 1, and if it is really necessary, then = 0,9999, maybe 1,0001, but more is possible. I'm wrong? Or am I far from economics at all? And in my reasoning, you don't even need to convince me that super-secured communication channels with encryption are used there. If a group of programmers were able to create this software, then what prevents the Soros comrades from hiring them (to force, steal, blackmail, etc.) so that they would leave loopholes in the code for these "destiny makers". It's my opinion.
    1. voyaka uh
      voyaka uh 19 January 2016 12: 10
      "Why not by how many goods and services the country has produced, but by the electronic numbers of monitors?" ///

      Evaluate both goods and services, and the exchange value of firms. Goods and services are what we have now, and the exchange is "waiting" (what may be).
      If you want to buy a company, then you are not only interested in what it sold
      last year, but how much she can sell in 2-3 years. And this is exchange
  8. vladimirvn
    vladimirvn 19 January 2016 11: 40
    World crisis. And the problems in China are just one puzzle. And we fell below many, because at one time we did little to diversify our economy. Although, of course, no matter how much you conjure the economy with the words "diversification, targeting, strategizing", and in order for it to rise, you just need to steal less for some.
  9. Nikolay K
    Nikolay K 19 January 2016 12: 46
    Announcing a large-scale privatization program, our government, headed by the president, in fact admits the fallacy of all the economic policies they have been pursuing for 15 years. After all, as we remember, the main economic idea of ​​Putin the statesman was the creation of large state-owned companies, which were to become the locomotive of our economy. Companies were created or enlarged, though most often not from scratch, but on the basis of still Soviet assets, putting their St. Petersburg comrades in charge, and what next? For all these years, the main thing that we remember about our "national assets" was the huge salaries of top managers and other middle managers, massive kickbacks and theft at all levels, and as a result, the constant growth of tariffs due to the ineffective work of state monopolies, for which you have to pay the population. The efficiency of the work of state-owned companies created from scratch, such as Rusnano or the Resorts of the North Caucasus, generally raises big questions. In that, it is not clear where our government is going to go next. Is state capitalism over, or is it just a temporary respite? Or redistribution?
      PHANTOM-AS 19 January 2016 13: 02
      Quote: Nikolai K
      there were huge salaries for top managers and other middle managers, rampant rollbacks and theft at all levels, and as a result, a constant increase in tariffs,

      State corporations have also created many subsidiaries and firms that are used as pumps for pumping money out of the budget.
      Quote: Nikolai K
      In toga it is not clear where our government is going to go further.

      Privatization of income and nationalization of expenditures is the main trend in economic policy.
  10. Nikolay K
    Nikolay K 19 January 2016 13: 12
    And one more thought about large-scale privatization. Any more or less literate person will tell you that stocks should be bought when they are cheap and sold when they are in price. Our state has decided to sell shares of the largest companies right now, when the market is at its very bottom. Are they really fools, or is our budget really that bad? Or maybe this is just a delicate calculation. Indeed, now in the country there is really very little free money and many oligarchs are thinking not about new acquisitions, but about how to preserve what they have. Accordingly, those who have money will be able to buy the tidbits of our economy at a cheap price. Who are these heroes? Of course, not foreigners, because they are now bypassing Russia, and no one will give them state strategic assets. Accordingly, someone from ours will buy, and most likely they will be "patriots" forced to return capital from London and Swiss banks back to Russia under the pressure of foreign sanctions and the threat of freezing and confiscating assets. Who do we have the toughest sanctions against now? That's right, against the Rotenbergs, Sechins and other "friends". In my opinion, they chose a very good moment to return money to their native economy, don't you think? And then the Central Bank is not averse to helping "poor" bankers with good connections in the Kremlin. The Central Bank has already allocated to the SMP Bank, owned by the Rotenbergs, a loan of 117 billion rubles. for 10 years at 0,51% per annum (in rubles!) for the reorganization of Mosoblbank and promised to issue another 55 billion. As you understand, this amount is much more than the loan issued by Russia to Ukraine. Another 174 billion rubles. The Central Bank promises to allocate VK "Otkrytie" for the reorganization of the bank "Trust". I will not be surprised if Vneshprombank will "trust" to sanitize also some of the "close" bankers and the amount will be even more significant. Eh, I would also like to take out a loan for 10 years at 0,51% per annum for the purchase of Gazprom shares. Then the slogans "national treasure" and "dreams come true" would not have remained just words for me.
    Well, now we, it seems, will observe the second wave of "loans-for-shares auctions", when people especially close to the authorities will buy up our national welfare at the state (that is, at our) expense. Maybe this is Putin's new economic policy?
    1. sa-ag
      sa-ag 19 January 2016 18: 12
      Quote: Nikolai K
      Really fools, or is it really so bad with our budget?

      But this is an interesting question, at one time I was surprised by Miller's visit to Greece with a proposal to build a pipeline there, despite the fact that Greece is a well-known debtor, it was known in advance how it would end, but the case was and it ended as expected, like people occupy high positions ... with the same Turkish stream, then it is a "stab in the back", I generally have a question about the sum of actions, do these people live in a common reality or in some kind of their own?
  11. Klim2011
    Klim2011 19 January 2016 15: 10
    In 2015, Ulyukaev said so many times that the bottom of the crisis was found, that he was nicknamed the diver.
    1. sa-ag
      sa-ag 19 January 2016 18: 13
      Quote: Klim2011
      In 2015, Ulyukaev said so many times that the bottom of the crisis was found, that he was nicknamed the diver.

      interesting, but whoever says that the bottom has been passed by a miner? :-)
  12. fa2998
    fa2998 19 January 2016 15: 54
    Quote: Nikolai K
    . One thing is good, our economy is already in such a way. . The position that it will not fall so high.

    Eureka! It turns out that the entire economic policy of our leadership is POSITION our economy, something will not be painful to fall! Moreover, the "pillow" is already pr ... Ali! By the way, they did it !! laughing yes hi
  13. NSh-011600
    NSh-011600 19 January 2016 16: 40
    The Chinese leader - the Russian: "Let's bang in August, so that the whole world is in dust!"
    In response, the standard answer: "We'll bang, but then ..."
  14. Bolhevik
    Bolhevik 19 January 2016 19: 30
    The Liberalists hike the pumping mode at the command of the West to "sit down and stand up." And the people, as they commanded at the collapse of the "lying down" and left, but time goes by and affects everyone in different ways - someone will surely "sit down" when the majority gets tired of lying.