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Comment of the Day

2016-01-09

Paul

Berkeley 2 hours ago

The government of China, like modern China itself, is a sham. The leaders of that nation’s communist party will do anything- be it correct, incorrect, or plain dumb– to try to keep the economic growth ball rolling because they know that the only thing that keeps them in power is growth. There is no other legitimacy to their leadership. The growth that has occurred over the past 20-25 years was the easy part– low hanging fruit in an era of globalization that favored low-cost manufactured goods, accompanied by historically low shipping rates and near zero interest rates for millions of consumers that wanted such goods. But now that the easy work is history, the leadership doesn’t know what to do next; its clumsiness in attempting to fix the stock market last summer is one indication, and its response over the past week to market volatility is a re-run of that behavior. Who knows what will come next, but one thing is sure: the party leadership is struggling and the odds are that they will fail. Why? The best solution is one they simply cannot abide: abandon their micro-control of the economy and their attempt to micro-control the behavior of the citizens of China. Until this happens, the globalized economy that we have today will suffer many more such episodes of incompetence from the fraudulent leadership of China.

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