The Economic Collapse Of China! $40 Trillion Dollar - China’s Yuan CRASH!
Will the Economic Collapse of China happen in the near future?
If the warnings of the International Monetary Fund are to be considered by China, their massive reliance on debt will create for them a huge debt crisis and china's yuan crash. Despite the increase in credit, China’s real growth has been shifting between 1-2% in the last three years. What they are doing is just like the former Soviet Union, fabricating numbers.
Using energy utilization as a measure of economic growth, energy utilization is currently pegged at 1%. As a “hyper welfare state” economy, what China forgets to consider is the absence of any proven welfare state-driven economy globally. Even though China is being touted as a success by “globalists,” present in the Chinese economy are indices of a failing economy. In the coming years, this is what will happen; China’s debt is like a bubble, and the bubble will pop and lead the chinese economy into an economic collapse. Chinese debt is majorly into properties. This is caused by the growing inflation by the PBoC, which made property investment the new gold rush. The new venture is building ghost cities that are not habitable for humans. In a few years of development, they have become a danger to its inhabitants. In the end, the ghost cities will become nothing but rubble and will force investors into further debts as they will be unable to service their debts. At this rate, China is headed for a disaster and chinese yuan crash when the debt bubble pops, and it will.
China’s debt bubble leaves everyone in a dilemma being the 2nd largest economy. Looking at the statistics, China’s debt has gone from 156% to 317% of its GDP between 2008 to 2018. If shadow banking debts are factors, we’ll be looking at 400% of the GDP. From this number, 190% is traceable to Chinese state-run enterprises. This is unlike what is obtainable in the US, where 70% of debt is linked to US Corporations. What the Chinese leadership is doing is to use state-run enterprises to accumulate debts rather than the People’s Bank of China. What we have in China is double of what is even an excessive standard in Western nations for corporate debt.
In the end, the debt trap will harm the economy of China, even a major economic collapse just like it has happened to many countries before it. In all of these, the state would resort to more debt to save the economy from total economic collapse, which will lead to depression. Another angle will be the Chinese Yuan Crash. There is a likelihood of social unrest, also, as the people will be unable to access and move their investment.
