August 6th, 2012
04:45 AM GMT
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(CNN) – There was lively debate among Business 360 readers on question posed by Friday’s post China slowdown bigger worry than eurozone?

The heart of Friday’s post was the conversation CNN’s Richard Quest had with Jim O’Neill, chairman of asset management for Goldman Sachs, that the slowdown of developing economies such as China was more worrisome than the eurozone crisis.

Many of the dozens of comments from Business 360 readers can be summed up in two words: What slowdown?

Jon B: “I'm an American and I've been living in China for 5 years. Yes, businesses are hurting and prices are rising, but China's people are only getting richer. Their economy is doing just fine for right now. Maybe within the next five to 10 years China will resemble the U.S. and its current struggle, but for now they are full steam ahead. There aren't many icebergs big enough to cripple this boat just yet.”

Marco Hsiao: “China (Mainland China + ROC Taiwan + Hong Kong + Macau) are all moving to more prosperity. Singapore has surpassed the U.S. on per capita income, and the gap is expanding. Their ancestors are from South China.”

Marie: “I was recently in China in Shanghai and Guangzhou. Both cities looked modern, all cars on the roads were new. McDonalds (sadly) was full and the meals were around $5. Nice new condos and houses were being built. I would say people there have more money than ever and the cities were very modern. No outward signs of collapse yet.

Other readers pointed out the one-party rule in China, its impingement on free expression as well as its command-economy ability to run by edict rather than through elected officials.

Migen Bora: “We must not forget that China is a dictatorship state. People there are not free (they don`t even know how freedom is like) … Now, China may have some economic results, but they come from underpaid workforce and by not having the costs that Western countries have (health care, RD etc). It cannot hold forever, one day it will collapse (like the Soviet Union).”

Srtcruz: “The Chinese model actually has one very distinct advantage versus the west – central control. That model will be better at resolving a crisis since the debates and politics are kept within a smaller core. They will not have the same political issues as the ‘Debt Ceiling’ in the US or the current political mess in the European Union – in-short they have speed and decisiveness.

“Can you imagine if both issues arise in a country four times the size of the United States? Oh right, India.”

With the President Hu Jintao and Premier Wen Jiabao both in their final year of office, readers pointed out this could be a year of turbulence or of greater Beijing effort to avoid a hard economic landing.

Godfather: “Deng Xiaoping – a period of economic growth; Jiang Zeming – a period of economic growth; Hu Jintao – a period of economic growth. The next President to be – do you think he will let China into a period of economic recession? And let his name be tainted in history? I bet the next man in power will continue to lead China into continual prosperity and god economic progress.”

Jun Sorioso: “I expect the Chinese leadership to be under a lot of pressure to window dress Chinese economic performance one way or another at least until the leadership transfer late this year. In other words conditions are probably worse than what we are allowed to see.”

Saorise72: “There are many problems in China besides the manufacturing and export issues. One issue is the growing amount of debt. Some cities like Wuhan are over 900 million in debt. There are the issues of illegal banking and trading in China, some of which American regulators just picked up on. There was also a huge speculation on housing the past 10 years that has gotten out of hand.

“Money is leaving China, many ex-government officials and their families have also left China. There is also a number of accounting problems, even with recent numbers posted about GDP growth. So when the new leadership comes into office they have many challenges ahead of them. With growing discontent and food prices they better find some solutions to chill out the inflation, cut speculation, increase accounting regulations, reform the banks, get rid of illegal banking, stop government graft – much like South Korea had to do in the 90's.”

Compiled by the International staff. Some comments edited for length or clarity.

soundoff (34 Responses)
  1. CHINA


    August 6, 2012 at 7:26 am |
  2. Jose

    One always need to be weary of a firm that runs both as a ratings agency, as well as an investment firm. Just like you need to be careful of a double-headed snake – one head presents a threat, while the other one takes a big bite. Strategic. Brilliant.

    Most smart investors always do the opposite to what ratings agencies say. Those smart investors too want to scoop up the wealth left in the wake of any downgrade on the stock market. Yep. Sure. China is going bust. Worse than EU. Sure. Now let's see if I can pick up some bargain basement price stocks after the downgrade of China.

    August 6, 2012 at 7:40 am |
  3. Adlass

    China is going much better than America for sure, all the bickering that exists in Congress doesn't exist in China and problems are solved. If you ask people there whether they'd rather have so-called 'freedom' or wealth creation, the answer is obvious. I suspect many Americans would rather have wealth creation too.

    August 6, 2012 at 8:14 am |
  4. Dirkje

    Well, maybe the China woes are even bigger than those of the USA. And these two are so intertwined that a disaster seems impending.

    August 6, 2012 at 8:22 am |
  5. EWEW

    then how about the 100,000,000 chinese who only $1 per day.
    china is the country puts all fat on its faces.

    August 6, 2012 at 9:07 am |
  6. EWEW

    then how about the 100,000,000 chinese who only make $1 per day.
    china is the country puts all fat on its faces.

    August 6, 2012 at 9:07 am |
  7. Allan

    "Migen Bora: “We must not forget that China is a dictatorship state."

    This is the kind of comment that shows a lot of ignorance about China. It is NOT a dictatorship. That would be a country run by a single individual. The congress that chooses the president is comprised of 50,000 people and the president does not rule alone!

    August 6, 2012 at 10:38 am |
  8. Jing Choi

    So there is no freedom in China

    August 6, 2012 at 11:34 am |
  9. vinod

    in a highly regulated market in US you have stricter control and checks than China. Still you have the banks defaulting, closing. Imagine China with no proper controls and regulations like developed country for that matter even india. if the analysts were allowed to scrutiny the accounts like in developed markets dread to fear the actual data which may come out. of course mine is lay mans outlook. You pump in huge money in developing infrastructure before there time. The returns are not there how does one explain the gap. Who takes care of the gaps – the govt from public money? All the financial experts would like to believe China is too huge to fail. They forget even the biggest of empires fall. I pray that does not happen to Chinese people at the end common man suffers for the error of judgements from the learned financial wizards, economistc, bankers, government actions.

    August 6, 2012 at 11:51 am |
  10. vinod

    by the way i am not a socialist, communist just believe in all round growth and development if possible where all benfit i know that is a utopia which is not easy to achieve or near impossible in near future for a long long time.

    August 6, 2012 at 11:52 am |
  11. reality

    Well if china fails we will all fail too...its a global village and we are all affected..

    August 6, 2012 at 12:00 pm |
  12. Stardust

    USA debt crisis biggest threat to the world economy!

    August 6, 2012 at 12:02 pm |
  13. Mark Taylor

    I believe that this is all a precursor to the next world war.The only way to solve the worlds financial crisis is a catastrophic event such as war which I don't want to see or be involved in but logic tells me there is no other way.Especially with all the global financial instability and the deluded war on terror. We are all part of the greater plan. Zeitgeist

    August 6, 2012 at 2:15 pm |
  14. gibson dean

    All the above experts are spoken by ignorant westerners who live in metropolitan cities in China who are blinded by the glitz, growth, and glamour. Btw, all the rich people in China wanna get their money out of their asap, what does that tell you? Why do you think the EB-5 visa is booming right, foreign Chinese investors has a fast track to get U.S. citizenship and protect their money...gee I wonder from who.

    Bottom line: China metropolitan cities do not represent China as a nation, that's like saying "hey U.S. economy is booming, just look at New York and L.A., everyone east at McDonalds <-what a load of crap, CNN, you disappoint me, who are these people you interviewed?

    This article is just like propaganda by the Chinese Communist Part..."look at how rich! everyone can eat McDonalds!"

    August 6, 2012 at 2:23 pm |
  15. jonusa

    A few million people in China get rich...."experts" thinks China is growing economically
    A few hundred million people in China live in extreme poverty, unhealthy living conditions, drinking dirty water, make $200 USD a month working 16 hour days, have no freedom to speak up, to have spiritual faith...."experts" turn a blind eye.

    Classy, CNN, NYtimes, etc etc.

    August 6, 2012 at 2:28 pm |
  16. Guldmanden

    The iceberg I see ahead for China is the effects of rampant corruption in all aspects of business and politics. I did business in China for 5 years and my experience and observation was not possible to get anything done without "payoffs" in one form or another. The danger is that in many cases the payoffs I saw or heard about were made in the effort to skirt regulations. As in the case of the mall collapse (in which the builder made payoffs to skirt building codes and put AC units on top of the building which ultimately caused the collapse of the building and the death of many people), the iceberg I anticipate for China is that the infrastructure of the economic and political system is being built on the same kind of compromised foundation of bribes and cronyism, and will ultimately collapse as the pressure increases...i.e., as the system heats up. BTW...I also would not be a bit surprised to find that some "payoffs" have been made to get the buildings of Pudong up so quickly. Would not be surprised to hear about a structural flaw in one of them. ..hopefully not a collapse.

    August 6, 2012 at 2:45 pm |
  17. Max

    China has become the slave labour to the extreme western capitalists.All problems for the west when it comes to manufacturing such as basic human rights, health, safety, pollution and profit over people can be avoided if they move off shore and use China as the manufacturing hub.All the west is doing is pushing all our problems into China where it doesn't become our problem.But this is all at the expense of western society creating huge unemployment and anarchy.

    August 6, 2012 at 2:48 pm |
  18. aurelius

    The main problem with China has not been mentioned above. And that is the level of uncertainties both economic and political. Anything can happen, both good or bad.

    August 6, 2012 at 2:52 pm |
  19. Lu Fu

    If the so-called crisis comes, then there will be a revolution in China.

    August 6, 2012 at 3:01 pm |
  20. Zuijiadeai

    While US like to talk craps about China, they forgot that their debt is increasing every single second. Each citizen is liable for $180,000 debt payment. And almost a quarter of it come from China.

    August 6, 2012 at 4:28 pm |
  21. That'snotTrue={


    A dollar a day....That's more of India's wage, in China the wages are growing. For all the ignorants yelling about slave wages, I suggest you look at this chart....

    August 6, 2012 at 5:47 pm |
  22. New Gawker

    Is China's SLOWDOWN really more worrisome than the EU's DECLINING economy and growing debt???? That's like worry who's worse off the guy who got a 9% raise which was less than his 20% raise last year or the guy who's on welfare and owes on all his credit cards.

    August 6, 2012 at 7:13 pm |
  23. Ed

    The Chinese are as racist as ever. They believe the myth that they are the superior race and will conquer the world through business, etc. Just like Hitler, but with a different strategy. The arrogance may even be worse.

    August 6, 2012 at 9:26 pm |
  24. Ed

    Debtors are slaves to debtholders; therefore think about China's influence.

    August 6, 2012 at 9:27 pm |
  25. Filipe

    You can't talk to a chinese person who lives in the cities of china, because they all think there the greatest in the world..which is simply not true, go talk to the other 50% of the population and see if you get the same answer, most chinese people think the usa is the dominant power, that shows you right there the propoganda coming from china, greatest country in the world with 50% of your population getting paid barely anything...yea that makes sence..that also explains all the chinese, and other asians, flooding into the usa, becoming citizens to make a better life for themselves.

    August 6, 2012 at 11:28 pm |
  26. gaucho420

    Hard to gauge where the truth is when they cook their books more than a dumpling in hot water. They could be having a slowdown, but none of the official stats will ever report it. The Julian Assange emails from a few years ago prove without a doubt the GDP figures are never what else is cooked and massaged to make it look stable?

    August 6, 2012 at 11:34 pm |
  27. atomicgeek

    The wikileaks shows a few years back a Chinese leader told a foreign diplomat China's GDP figures are not accurate, local government GDP figures are for reference only, but he also added he would use energy consumption growth as a measurement for economic growth.

    With that said, here is a few facts, China is adding one new coal power plant every week, seeking oil and natural gas all over the globe, increasing investment in wind/solar/hydro energy development, and planning to triple its nuclear energy output by 2030 with more than 20 nuclear power plants already under construction and 30 more new approvals.

    With this much hunger for more energy, I'd say China's official GDP figure is rather understated.

    August 7, 2012 at 12:54 am |
  28. Sudarshan

    China as being our 2nd neighbor country after India.... is growing very fast ..... ... people getting richer and richest every day ..... ... what would be the happiest moment for country like us ...... small and poorest ...... ... to have such a huge and fast developing nation in our north ..... keep it up China .......... and see your neighbors too !!!

    August 7, 2012 at 1:55 am |
  29. Marco Hsiao

    Correction: The US woes will be bigger than EU.

    The US Federal debt is exceeding US$ 16 trillion. Obama administration borrows 7% of GDP but only 2% growth. The Federal treasury is approaching to peril but the corrupt US government still spends huge money on military to kill innocent people in Afghanistan, Pakistan, Libya and Syria. The US woes will happen in about late of 2019.

    On the other hand, the economic cooperation between Mainland China, ROC Taiwan, Hong Kong, Macau, Singapore and overseas Chinese are becoming enormous and harmonious. Mainland China is developing fast; now is just at her beginning period. Mainland Chinese are becoming happier because salary is upgrading.

    August 8, 2012 at 2:16 am |
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