Tuesday, May 8, 2018

China's future that keeps expanding debt.

The world debt burden was 164 trillion dollars, which turned out to be the largest ever. Among them, China is regarded as a country of concern. China is one country and accounts for 3/4 of the global debt growth, the impact of which has risen to a level that can not be ignored.

Nonetheless, debt is not a bad thing in capitalist society, and it is designed that the economy turns around by someone borrowing money. That is why the world has to aim for economic growth alone and aim for inflation. People have become enriched by this cycle being successful.

However, China is not a capitalist society, it is a country of socialism. Socialism is a concept that was designed with the opposite idea to individuals, freedom, capital and so on. To put it briefly, we are aiming to build a society that focuses on weak people, from the standpoint of the economically weak people, so that the people can live equally, rather than expanding the interests of individuals and the country.

At first sight, although it is a good idea of ​​hearing, productivity is difficult to rise because socialism equally distributes profits to all citizens regardless of how much work, how much it will actually be done The growth of growth will be hindered.

As existing socialist nations stay at the minimum number such as China, North Korea, Cuba, Laos, Vietnam and many countries have collapsed one after the other, "modern socialism is just a utopia" It is common sense. In a socialist state, naturally economic growth can not be done like capitalism, it is impossible to repay debts.

However, while China is a socialist state, it has achieved dizzying economic development in the last decade. Why?

That is because China gradually adopted its own capitalist element while being socialism. Economic development in China is outstanding, and now China has a disparity in rich and poor levels that is not comparable to Japan. If you think that luxury cars are running in town, there are many people who are begging and somehow it seems that "Japan is much more socialism?"

Nonetheless, China is certainly a country with many concerns. According to the IMF, China expects to continue to increase debt to achieve the target GDP in the future, but in China the bad loans are rapidly increasing under the economic slowdown.

In the meantime, there is concern about raising the risk of reluctance to lend to the private sector and renting off and lending to state-owned enterprises.

According to Moody's, the world's largest credit rating agency, it was found that statistical omission of 3.5 trillion yuan of debt outstanding resulted from checking statistical figures released by China. Moreover, it is pointed out that the debt outstanding for statistical leaks is highly likely to be illegal and almost uncollectible.

China is a runaway train no longer having brakes, and it is not surprising when you can cause a derailment accident.

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