China's Economic Growth Model Is Dying | Michael Pettis

[@BlockworksHQ]

Michael Pettis did a second interview with Jack in summer 2024: kzbin.info/www/bejne/qWLFhJ5ued-rodE&ab_channel=BlockworksMacro Today’s show is brought to you by VanEck. To access VanEck's Income Investing Yield Monitor, go to vaneck.com/ForwardGuidance

[@roberts2697]

Gordon Chang No, 2. No. 1 is hiding.

[@MrManny075]

The Chinese system of government is way better than the so-called West, they plan and execute they don't worry about elections and they don't have a lobby system, leaders of the so-called West will love to have this system but they can't it's too late unless there is a revolution.

[@tonyfaulknor8273]

1:02:11 Basically gambling on what these occultic nitwit accountants will do next. Is that so hard for these FED pups, to understand?

[@一个说话大声的中国人]

No wonder the Chinese commies are still in power, because they get the advices from most coherent and fact based guests of the west commie lovers.

[@Unisoft-data]

NOW PLACE THE SHORTING BETS!

[@AnnaOllsson]

The U.S. economy relies on ongoing credit and debt generation for sustenance. The Federal Reserve is expected to increase the money supply, leading to further debt accumulation for the average American. Meanwhile, foreign nations continue to desire the U.S. dollar, despite their own economies facing significant challenges, some even worse than that of the U.S. This situation raises concerns about who will ultimately bear the consequences of these economic dynamics.

[@HildaBennet]

They do say gold will crash in a liquidity crunch However, many of those holding precious metals are preparing for such an event. So they are unlikely to be forced sellers. The paper market would tank and hopefully collapse.

[@PennyBergeron-os4ch]

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Her name is “Rebecca Noblett Roberts” can't divulge much. Most likely, the internet should have her basic info, you can research if you like

[@bartlyAD]

I just checked her out and I have sent her an email. I hope she gets back to me soon.

[@micbrett1]

Probably one of the most coherent, fact based guests you've had on. He puts into words what I have been seeing for at least the last decade. Thank you.

[@twistedneck]

is it just me or do you guys also keep re-winding each segment to understand exactly what he said.. and btw he runs a Chinese record label.. wtf??

[@kennethli8]

100% agree. Pettis debates with his fellow professors and China economists and he usually makes the other person speechless. Conservatively speaking, Pettis has been right about China's economic direction for at least over 8 years. I have been following Pettis for over 10 years and he is one of the very few who understands the Chinese economic and political system. Do not listen to idiotic Wall Street banks when it comes to China.

[@chiscoply97]

@@twistedneck sí le fui entendiendo, pero es difícil lo que dice si uno es un aficionado, en unas dos ocasiones sí rebobiné, pero fue para ver si había entendido bien porque lo que dice no lo ves fácilmente en otros lugares, entonces al ser algo nuevo yo mismo me quedo dudando si entendí bien o no, hubo una parte que ya había escuchado, aquello de la trasferencia de recursos entre los entes económicos (Estado, Empresas, población), pero no lo había entendido y con él ya me quedó claro y concluyó lo que ya había concluído yo, hay intereses en USA que no les importa USA, les importa únicamente su bolsillo aunque China esté perjudicando continuamente a USA, al final también los chinos comunes pagan con malas condiciones laborales, salarios bajos, etcétera, es una relación entre el Estado chino y sus ricos, con los ricos de USA y durante décadas USA ha hecho lo que China ha querido porque los ricos de USA tienen demasiada influencia en el Estado, sin lugar a dudas lo más perjudicados han sido los ciudadanos estadounidenses y USA como país excluyendo a sus ricos, luego los ciudadanos chinos, pero hasta cierto punto porque mejoraron sus condiciones. Definitivamente USA tiene que despertar, sus élites los están traicionando en su cara, desde que fue Kissinger a China les han estado viendo la cara de tontos.

[@twistedneck]

@@chiscoply97 I agree he is very difficult to follow because you want him to stop and explain wtf he just said and THEN keep going.. but still I have yet to hear anyone with this type of grasp of China.

[@mfactory451]

bwahahahahahahah

[@darkstar2871]

Got introduced to Michael Pettis through this video and I must say this is one of the best videos I have watched on economics. Depth and clarity of thoughts is amazing.

[@supremesoftware]

What has he said about America in debt of 34 trillions USD?

[@DavidLee-x7l]

Anything bad about china will draw in these indian fanboi .. Delusional and still think their toiletless country will become a great power

[@ToneHelix97]

@@supremesoftwarehow is that relevant?

[@supremesoftware]

@@ToneHelix97 Of course it's relevant, China’s high debt is spent on investments in infrastructure, manufacturing & technology which are likely to have high returns. While US High debts is spent on military expenditure & 800+ overseas military bases throughout the globe, invasion of many countries throughout globe & propaganda of fake news which are going to have negative returns. Debts are very crucial to a nation's development if it's invested wisely.

[@supremesoftware]

Of course it's relevant, China’s high debt is spent on investments in infrastructure, manufacturing & technology which are likely to have high returns. While US High debts is spent on military expenditure & 800+ overseas military bases throughout the globe, invasion of many countries throughout globe & propaganda of fake news which are going to have negative returns. Debts are very crucial to a nation's development if it's invested wisely.

[@vandycks1]

Wow! As an economist this ei one of the best lessons on global economy’s and trade I’ve ever had in a language that most people can understand! This channel is a gem and I’m going to promote to my contacts !

[@719603]

Pleasantly surprised to see Michael Pettis on here. I'd say he's a world class expert or the man on Chinese economics. Thank you!

[@thomasherrin6798]

He understands China's problems, it must be frustrating that he is in no position to alter it, some of the geopolitical variables he didn't talk about could cause fatal blows to China!?!

[@hanfucolorful9656]

美国31万亿债务是指联邦政府债务，而中国52万亿是全国所有债务，包括中央政府，地方政府，企业债，家庭债加起来52万亿。跟美国的31万亿完全不是一回事，美国如果你算它的总债务，联邦政府加地方政府，加企业债家庭债，是美国GDP的1500%，远远高于中国的300%.

[@asw654]

​@@hanfucolorful9656the people who think China's total debt is anywhere close to US total debt are delusional.

[@supremesoftware]

What has he said about America in debt of 34 trillions USD?

[@Lioc]

I am a simple man, i see a video with Michael Pettis, i hit like.

[@supremesoftware]

What has he said about America in debt of 34 trillions USD?

[@wnimiumeducatus4979]

Truth

[@junweihe8229]

Simple minded indeed

[@mungoblakey1494]

Wow! This guy makes everything make sense. Honestly macro is super annoying in that so many people can just spout bs and get away with it, but Pettis articulates all of his arguments super well. Gonna buy his book, Jack, your doing the Lord's work :D

[@25Soupy]

I agree 100%. Just proof at how many so called macro economists don't really know what they're talking about and their massive ego's won't let them learn or correct what they say day in and day out. Really makes me wonder if the people working at the FED and other government agencies understand the economy at this level?

[@leekinboo]

Thanks! very good ,i get so many things clear and also different from what I thought before,..

[@TheCabinman]

One of the most intelligent videos I have seen on KZbin in a long time …. Nice work!

[@imtryinghere1]

It is not a far-fetched statement to say that Jack Farley is quietly building a track record as one of the pre-eminent financial journalists in the world today.

[@shad00w239]

Already in my book lol, but he has so much room to grow and I'm here for every minute of it.

[@nigeljones9479]

He gets some great guests but perhaps he should ask more challenging questions

[@imtryinghere1]

@@nigeljones9479 he doesn't appear to have deep training in accounting or a legal background, but he has picked up economics, central banking quite well. Everyone has their area of strength, weakness

[@williambannister1127]

Jack should be proud of himself!

[@maxg9680]

Jack Farley is a smashing hit, IMHO. His questions are highly intelligent, open-minded, and most of all, represents the most important things that an intelligent audience wishes to know. His tone of voice and cadence is not like some other sites where the host's voice seems filtered out of high pitches and loud accents that make them sound calm and objective, but artificial and not reflective of your curiosity and interest.

[@Sam_Goetmaekers]

The People Republic of China is not dying in its growthmodel, it is just changing and continue growing.

[@zojkalle94]

Be quiet Chinese bot

[@JoelER78]

But, it's not growing

[@stone-hand]

Alas, I am not sure that the changes that we have seen as of late are really going to be all that helpful.

[@bill4056]

be quiet, this is for propaganda purpose only. sssshhhhh

[@henrychuah9658]

😂😂😂😂😂 have you guys received a fraction of payment of 1.6 billion budget to discredit china.

[@anthonyyoung6489]

The quality of guests you’ve been having on lately has been impeccable. Just the highest quality.

[@Cedartreetechnologies]

Wow, Jack! Huge props for getting this most brilliant economist on your show!

[@kennethli8]

100% agree. Pettis debates with his fellow professors and China economists and he usually makes the other person speechless. Conservatively speaking, Pettis has been right about China's economic direction for at least over 8 years.

[@HKim0072]

He's an ex-bond trader. Bond people always need to be extremely well versed in macro stuff.

[@一个说话大声的中国人]

No wonder the Chinese commies are still in power, because they get free advices from the west commie lovers such as this most brilliant economist Prof Pettis.

[@a5tudent]

Thank you for having the Professor. You provided many fascinating insights. Your excellent questions together with the Professor's exceptional knowledge and talent for communication make a powerful combination.

[@milerpiao]

as a Chinese, I'm quite agree with what Prof Pettis said, he knows about China very well. my respects to him!!

[@DK-ev9dg]

You are a liar.

[@aburetik4866]

a Chinese named Tom Park

[@milerpiao]

@@aburetik4866 haha, believe it or not, I am Chinese and still living in China and visiting KZbin via VPN.. using VPN is illegal in China, internet is censored..no one want to use real name..

[@cooldudecs]

China is collapsing...

[@mickey1849]

@@milerpiaoYes. Using a vpn is illegal in China. It's time to round all you bad Chinese up and put you in prison!

[@cheeho9698]

The assumption is based on the the inability of China changing is mode. China had been changing its model non stop since 1945 after WWII. In the past 40 years since 1980s its economical model had changed so much that it is unrecognizable from its original communist mode. I believe it will change its model when circumstances demands changes. Their economical is pragmatic and not dogmatic or demagogic as Deng Xiao Peng aptly summarized it with his famous words "It does not matter whether it is a black cat or white cat. As long as it catches mice it is a good cat".

[@theraljaxtin]

Xi Jinping's one-man personality cult rule isn't dogmatic or demagogic?!😂

[@federicohan1458]

Lovely synopsis of one of Michael’s long standing theses, he’s really the king of explaining macro accounting /identities …30’ onwards. Thanks Jack & Prof .

[@davidzoller9617]

Wow, now that's an hour very well spent, one of the best interviews around economics I ever watched. I guess, if you watch this a few times and understand the described mechanisms by heart, you may understand more about economics then most economy experts. Thanks Jack!

[@kennethli8]

100% agree. Pettis debates with his fellow professors and China economists and he usually makes the other person speechless. Conservatively speaking, Pettis has been right about China's economic direction for at least over 8 years.

[@msmarialr]

Thanks Jack for this informative interview. Prof. Pettis is an absolute pleasure listening to.

[@thomasherrin6798]

A pity that the CCP doesn't listen!?!

[@ServoSambo]

I’ve learnt a lot from this episode. Thank you Professor Pettit and Jack.

[@kennethli8]

Pettis debates with his fellow professors and China economists and he usually makes the other person speechless. Conservatively speaking, Pettis has been right about China's economic direction for at least over 8 years.

[@ServoSambo]

@@kennethli8 the USD10 trillion of shadow financing vehicle debt is what is foremost on my mind when it comes to China. American economists, commentators amd investors seem to have convenient blindness to it. Sure, it’s mostly yuan based debt but the CCP can’t print their way out of trouble this time because of the housing crisis. Citizens will be destitute if they do which will create a feedback loop in terms of local government revenue. Hey, but Blackrock says it’s a great place to invest so it must be, right?

[@steviechang]

Pettis an absoute power house and authority figure on the subject. Thank you Jack for organising this and asking a great set of questions. Blockwork Macro at all time high!

[@maxg9680]

Pettis has a way of clarifying complex economic ideas, although I do not agree with his conclusion that increasing domestic household income thru income redistribution will solve the problem. It will only exacerbate the problem and introduce consumer price inflation, which so far has been under very good control. The problem is the retreat of globalization that forces business to reduce its productivity, which in turn reduces household incomes.

[@georgesiew6203]

Pettis is not a power house or authority figure on the subject. He is practically the only English language analyst that covers the Chinese economy. He's the only one accessible to western audiences and it's been that way for many years. His analysis however is terrible as he structures his analysis to appeal to English audiences and their biases. In the Chinese language space where there are thousands upon thousands of analysts that cover the Chinese economy, Pettis is a nobody, listened to by nobody. Also he is not a professor of anything with an academic track record of anything. He's just the equivalent of a long time non tenure track lecturer at a Chinese business school in China which struggles to find English speaking lecturers to teach courses in English. He's the equivalent of a seasonal contract lecturer teaching your MBA class at your local business school. In recent years he's turned his blog which is one of the very few English language blogs on the Chinese economy to appeal to the China bashers in the US and has gotten some positive attention from that. He's nothing more than a less outrageous Peter Zeihan. I will post a longer comment to this video to debunk most of what he says in this video soon. It is too bad that there is barely any intelligible analysis on China in English language media.

[@olderchin1558]

​@@georgesiew6203 Thanks for saying what I wanted to say. Pettis is being referred to by more western commentators these days. He does get somethings right but distorts the rest. He is a western commentators raised on a distorted western model of economics that only work for a country with the privilege of issuing a dominan reserve currency.

[@andymcrae4661]

English clearly isn’t your first language so I will be brief. He is spot on! If you are so intelligent on this matter, why does no one care what you say?

[@balozhende5727]

The USA has far more debt than ANY country. Indeed Japana and China hold more of the U.S. Treasuires compared to any other foreign country. Thoe Treasuries represent USA debt. I am an American economist.

[@Eric-is1jt]

Thanks!

[@Philip-lk5db]

So many Americans hate China as they listen to their government saying that China is taking all your industries but stop for a moment and think! Many US firms moved manufacturing to China due to ‘at that time’ cheap labour, in returns for maximum profitability. Americans should be blaming the CEOs and shareholders for this outcome and demanding that more things be manufactured and sourced from within the US.

[@NCM-xy8ow]

And what would happen to inflation in the US? Affordable goods sourced from China and elsewhere allowed millions of middle class Americans to live like royalties for decades. The problem is the corporations (and their govt) did not distribute the extra earnings fairly in their home country.

[@gregoryedwards9097]

Exactly. It’s baffling how little critical thinking exists.

[@delmaregals]

But to dwell deeper not really, with max profitability American stock holders also benefited from dividend, capital gains,etc so what's the issue really? Just political drama, propaganda and brain washing for political gains. People likes drama, soap stories and fiery instigations. Think that's the overall story.

[@MrKbtor2]

I only have a BA in Economics and an extensive background of personal involvement with China, but his analysis is objective and excellent!

[@guydreamr]

Came here to hear about the economy of China, stayed for the amazing discussion on the nature and causes of current account surpluses and deficits and how foreign exchange works as well.

[@dianedean4170]

Excellent conversation 🎉 Thank you so much, Jack and Michael. I think understanding what are the financial incentives in every country, in particular, the larger countries, is essential in keeping a healthy perspective on the money supply. I look forward to listening to your podcasts in the future 🎉🎉🎉

[@一个说话大声的中国人]

No wonder the Chinese commies are still in power, because they get the healthy perspective on the money supply for free from the west commie lovers.

[@vineettoshniwal2927]

This is an excellent analysis. I have watched this 3 times already and I would re run this at least 4-5 times.more to.internalise all concepts and data. You must do a series with Professor bring in topics like BRICS etc.

[@davidaulia1595]

This is such high quality MBA equivalent full of insights interview. Thank you so much.

[@kennethli8]

Per the Bank for International Settlement, the Chinese shadow banking industry alone is estimated conservatively at least 3 times larger than the 2008 Financial crisis. Add that amount with the on-the-books and off-the-books balance sheet, you can imagine how big is the real estate lending in China.

[@aminbolandi6039]

Hello, I am great for seeing Michael Petis video. Thanks

[@RobWilliams007]

There’s a fourth reason that people quit spending: they’re so far in debt that they can barely service their bills let alone spend on eating out or new appliances, etc.

[@fremeer]

Well that debt goes somewhere. Someone gets the income from that debt. In this case it's just another form of redistribution towards the wealthy or government.

[@RobWilliams007]

@@fremeer or to foreign governments and thus, leaving our system and losing that precious velocity of money.

[@gstlb]

Wow. Best interview on Chinese economy ever.

[@mere_cat]

I read Trade Wars are Class Wars a couple years ago after I heard Michael Pettis on another podcast. I can’t say I 100% understand how it all fits together, but the central idea is profoundly interesting.

[@Fish_Ventura]

Excellent to hear from Mr. Pettis @china update

[@WhoCares..808]

Some may or may not agree with his thesis but this guest is of one of those very rare economists (top 5%) - whom you don’t see on CNBC or Bloomberg - who can articulate global macroeconomics in a very simple but succinct manner! 👍👏👍

[@Leshic2]

He's been on CNBC, but not very often. It's almost a 12hr time difference to NYC. The times he's been on, the staff are beyond impressed. I can't see him being on Bloomberg. It would upset China too much...

[@abc-oe8hw]

Jack Farley is just amazing. Simply the best

[@philiplaw2072]

Pettis thinks China need to solve their problems of having too much surplus. I am sure a lot of countries would like to have China' s problems.

[@chrisschneiders6734]

Maybe listen again, l thought he explained that very well.

[@AndrewGleave]

It's hard for non Economists to understand, a large trade imbalance is unhealthy for both sides. China will now have to experience some prolonged economic pain as their GDP growth worsens in the longer term. The party has to come to an end at some point

[@squidster3128]

In the first quarter of 2023, China’s GDP growth has beat market expectations. According to preliminary estimates, China’s GDP in Q1 2023 reached RMB 28,499.7 billion (US$4,145.5 billion), up by 4.5 percent year on year (YOY) at constant price.

[@Gman979]

​@@AndrewGleave give me 10 economists and I will have 20 versions of economical analysis. Remember 2008 on world renowned rating agencies filled with top notch economists and man how wrong were they.

[@Strykenine]

Such a good interview. Pettis understands things on a very deep level, and he is the person I credit for my own interest in macro.

[@JJ-bd8of]

I think Michael Pettis has the best understanding of international trade and economics of anyone on the internet. He should be part of the next administration.

[@thomasherrin6798]

For China anyway!?!

[@ShirleYangZi]

You provide many fascinating insights. The great questions you asked are a powerful combination with the professor's excellent knowledge and communication skills

[@davisoneill]

Outstanding interview and great to hear a serious discussion of China without the anti-China propaganda BS.

[@johanneswestman935]

Nothing is more boring than listening to Americans kvetch about the danger of China only to switch their stance 5 minutes later and say that it's game over for China. They do the same with Russia too. We should all be extremely scared of Russia but at the same time Russia is a completely incompetent gas station with nukes. At least pick a narrative ffs.

[@theonlyconstantischange123]

Yes seriously enjoyed this...also Weston's first interview was great too. Really liking what BWM is doing

[@thomasherrin6798]

I'm sure the anti-west rhetoric is a number of factors worse from the Chinese, a lot of it is just absolute codswallop!?!

[@retsdon]

When Michael Pettis talks, I listen. Thank you for this.

[@chrisgibbons3877]

Thank You Jack, Thank You Michael truly an excellent interview! I've read his book but this so enlightening.

[@veronica.baker1]

Impressive video. I started a bit late (graduated from my doctorate program at age 30 in 2014 with 170k in school loan debt). Managed to pay off my debt by 2019 and currently have a house and 250k total in investments (combo of profit share, 401k and a brokerage account). I'm not very knowledgeable in investing, so I just have my investing currently in index funds mainly Too but have been putting a lot into Schd the past few months. I don’t know if that's the optimal strategy, but psychologically it is very set it and forget it, and prevents me from obsessing over individual stock performance.

[@edward.abraham]

I’m thinking of doing the same but not sure if I should use different brokerage accounts? Just curious. Pros and cons ?

[@james.atkins88]

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[@rebecca_burns14]

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[@james.atkins88]

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[@rebecca_burns14]

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[@williamhoffer9277]

This was a very interesting, informative conversation!

[@samuela-aegisdottir]

Amazing interview which connect the facts and numbers clearly and gives a very good insights into corrent problems of China's economy as well as their origins and future consequences. And we get to know a lot about US and the Wordl's economics as well. The fact that in trade inbalance, in both countries, the rich get richer, the working class and middle class suffer, and debts rise, is mindblowing, but so clear and logical at the same time. I had no idea about that. Thanks!

[@Palmer-gs3wz]

Economics, international trade and finance seems extremely interesting now that I'm 37. 😅 why couldn't I like these subjects when I was 17.😢

[@4183Johnny]

This was excellent; one of your best guests to date.

[@Baldwin321]

Stocks extended their year-to-date rally following the CPI report, with the S&P 500 last up 0.8% in afternoon trading. but I don't know if stocks will quickly rebound, continue to pull back or move sideways for a few weeks, or if conditions will rapidly deteriorate.I am under pressure to grow my reserve of $250k.

[@Theodore3241]

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[@Alden457]

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[@Alden457]

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[@Scarlett34568]

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[@nfixion]

This a Super Great video! I thank you for bringing this guest and subject!❤

[@gj8550]

A primary reason that China has a trade surplus is that more and more Chinese are buying domestic products. American export restrictions (such as chips) are contributing to that behaviour. Domestically produced cars are outselling imports. Huawei are more popular than Samsung and iPhones combined.

[@tonysu8860]

Don't know where you're getting your information. A trade surplus has little to do with great Chinese consumption unless China just chooses to make stuff domestic Chinese don't want. American import restrictions don't describe chip sanctions well, chip sanctions affect Chinese manufacturing affecting everything, both export and import. Domestic car profits are crashing. The goosed up numbers for the past several months have been heavily dependent on deep subsidies and discounts that wiped out all profits and is likely going to result in a mass contraction of China's EV manufacturing. Huawei is popular in large part because the CCP is doing everything it can to support it over foreign brands in this time of need.

[@gj8550]

@@tonysu8860 Trade surplus has a lot to do with domestic consumption. Chinese are buying domestically produced goods as opposed to imports, thus contributing to widening the trade surplus. Because of American chips export restrictions, Chinese are buying domestically manufactured chips. For a variety of reasons, Chinese are buying EVs rather than fossil fuel cars. Since China is the world’s largest EV producer, naturally Chinese consumers are buying domestically produced cars. US government was offering incentives for Teslas as well. Every government subsidies its industries. Following the recent passage of the US Inflation Reduction Act that offers tax breaks to certain domestically manufactured goods, Europe introduced the Green Deal Industrial Plan in retaliation.

[@passby8070]

@@tonysu8860 Huawei was undoubtedly the king of Phones not just in China but around the world before the US clamp it down in so many dodgy ways. Huawei was the leader in telecom patents and on track to dominate every area telecommunication, the US got jealous and reacted in a way shows its true colors.

[@davidrichards1741]

Even the US data shows that the US deficits are soaring higher than ever before. This is consistent with growing Asian trade surpluses. Therefore very believable. But the US market is already now secondary to China. The Chinese trade much more with the rest of East Asia today than they do with all of North America. And China's #1 customer is the local chinese, by far.

[@happyhappynuts]

​@@passby8070 this just isn't true. In Europe, Huawei wasnt dominating and in fact is and was pretty rubbish, OPPO was and is more successful. Inside China, the government gave directions and hints to Unicom amd China Mobile to prioritise Huawei. In my company the only people with Huawei are party members, having bought a couple of years ago.

[@highbrass3749]

The wealth needs to be “transferred” to the workers. Not just the poor. Hard work should be profitable. It’s the only way to keep up production. The “poor” in America are actually doing quite well for not contributing to society.

[@frankjhall1]

Where china has us beat is they are ethical. They don't want a hand out. That's a discrace. So in the public sectors jobs and unessasary jobs are created. Some pointless. The 50 plus crowed that has limited or no education\skill sets. The very large boomer population. Them and others across board for ? reasons. Regional? They are subsidized. They have also the same problem of shrinking pop. 1 child thing. Which is mind bogling for having a billion pop or what ever true number is and % of. And why the flood gates opened at mexico. There illegal. It's about the children going to have to participate in the legall system. Get educated, be American and contribute aross all fields. And hopefully shake there primary language as my grand parents did. Because they wanted to be Americans not take advantage of. Which appears to be the trend. But may not be nessarily so. Chinas importing women since such a male population. Any people factors. Ethnicity, religion, ect. comes 2nd or not at all to $$$$$ economics.

[@fahrradflucht]

Sure replicate narratives the super rich want you to believe to not come after them, but instead kick down to feel better. Compared to them everyone is poor and that’s what was meant here. Every dollar out of the pocket of the rich into the pocket of the poor is an investment dollar that goes into consumption.

[@fernandoesteban2345]

Prof Pettis has presented an extremely accurate and nuanced snapshot of the Chinese economic progress, thank you. Nothing here for your audience looking for short term investment tips unfortunately😁. Thanks Jack for the introduction.

[@luly2323]

I am sorry ,he is clueless!

[@thomasherrin6798]

Didn't he big up US assets!?!

[@thomasherrin6798]

​@@luly2323 He is more cognitive of the Situation than say the CCP!?!

[@jgwizo]

At times one is confused with USA education which are based on artificial issues such as advanced versus unadvanced. China changed the world and only those who argue from compromised logic like a foreign corporation not accepting the fact that they are parasites unless they accept secondary role of having less than 50% equity.

[@dt-jy1ig]

Too bad more Americans don’t understand Michael’s description of trade, surpluses, and deficits. They’d realize how a strong dollar isn’t necessarily in their best interest. They’d realize how important domestic US investment is to rebalancing of the US economy. They’d realize how many people have no clue what they’re talking about.

[@wnimiumeducatus4979]

..."brainwashed to the bone."- George Harrison

[@RPSartre01]

Great interview! I subscribed. Your guest really knew his stuff!

[@Leshic2]

If you liked this, and like Pettis, then you might like a channel I've been following for a while, China Update. (yes, yes, i'm plugging another channel) I'm polish american. Leshic is a nickname i go by, and could help but notice your last name. China Update is run by a New Zealander, who's fluent in Chinese, lives there, and used to be a student of Pettis (the guest in this interview). He frequently quotes Pettis's view on current events. He basically covers China economics, and geopolitics. I saw your comment on Chinese Russian bots. They frequently try to take China Update down too. The information and presentation can be very dry, college graduate level, and he does his best to be a neutral as possible to avoid getting taken down.

[@soulsearch4077]

Quite informative. Great content 👍🏼

[@posthocprior]

Wow. This was a fantastic interview.

[@hansdoreen]

As someone who lived in China for around 20 years and another 20 years in NA, I agree with Prof Pettis 100%.

[@szymonbaranowski8184]

where did you move after?😂

[@sonyjoseph5426]

What part of China did you live at

[@hansdoreen]

@Yee Tian I guarantee you I lived in China for 20 years.

[@hansdoreen]

@@sonyjoseph5426 我大部分时间住在中国北方，北京，沈阳，大连，鞍山。中国南方一些大城市也去过，上海，苏州，杭州，无锡，南京，广州，等等。In case you can't read Chinese, I lived in northern part of China, Beijing, Shenyang, Dalian, Anshan. I've been to quite a few southern Chinese cities as well, Shanghai, Suzhou, Hangzhou, Wuxi, Nanjing, Guangzhou, etc.

[@hansdoreen]

@@szymonbaranowski8184 I'm still living in North America.

[@alpenroseable]

it is the best interview i heard on this topic

[@HumbertoPatricio]

What a lesson!! Thank you so much. 🙌❤️

[@MarcelLechin]

what a phenomenal interview!! Congrats keep up the good work

[@sampotter4455]

Wow, great interview! I'd love to hear more from Michael Pettis, like a whole class. Excellent information and very helpful. (Non-finance person here).

[@alexanderchenf1]

Finally a helpful guest

[@tylerwasson4788]

This was a great interview best one I've seen in awhile. Hope this guy is on again.

[@chstorch]

Maybe the best interview you have ever done!

[@raanadisa472]

This supposedly expert feels like Gordon G. Chang in disguise🤔

[@rafeekgafoor8084]

Where does he work again?

[@Passio7Jd]

Great to see Mr.Pettis here!

[@Abhishekkumar-up8zw]

Finally I found someone who is not biased. Neither anti- china nor pro. A true analysis. Thanks for this podcast 🙏.

[@hpmoxie4660]

Prof is a real expert and talks substance!

[@jeromez7148]

As a 35 yo Chinese, I agree part of Pettis' view, and I want to point out something you miss in the domestic consumption part. Nowadays, Many ordinary Chinese live through the tough time of China contribute a lot to the savings, their age are among 60-90, and they are very unlikely to have the wiliness to spend money on things other than the basic living related stuff. I know that because my grand mother is one of those people, she had to beg for food at her young age. She spend as less as she could and save as many as possible.

[@legendbe2023]

Its generally true that when people get older they consume less, which is not good for China and Japan due to their fast aging populations.

[@seekfunk3536]

very clear explanation from Prof Pettis. And makes a lot of sense.

[@disgruntledtoons]

An economy can grow three ways: More people, greater access to foreign markets, and greater productivity of labor. As far as China goes, the first two are not going to grow (the first one is in decline). The third will eventually reach its limit. Capital investment was low in China, and it's higher now, which is most of the reason for its historic growth, but returns from more investment will become less and less, and China's authoritarian rule imposes a ceiling as well.

[@kalipotmeng]

Prof. Pettis is no doubt an expert. I'm missing in this interview that the interviewer did not seize the moment to ask more about the struggle between the central and local government and how the local governments could release more income to the ordinary people in china. This seems to be the only solution to china's development problem if it doesn't want to fall neither into the US model of cyclical crisis nor in the Japanese model of long term decline. Can there please be a sequel with Prof Pettis ?

[@cryptokid1021]

LOL…. YEAH LETS pretend the US $31 trillion debt ain’t the Elephant in the room🤭

[@davidrichards1741]

$32 trillion immediately due on the balance sheet, plus another $300-trillion of federal legal liabilities hidden "off balance sheet". That works out to $5-million per working american!

[@maemorri]

I'm confused as to why he says that local government share of GDP must decrease in order for consumers' share to rise. My understanding of much of the imbalance is that local governments raise money through debt and the reclassification and sale of land to developers. If the local governments are no longer spurring on the infrastructure and development spending, that will dry up their land sales and coninvestment in development. But then they would have no revenue to service and retire their debts. Wouldn't they have to raise revenue in the form of taxes? But that revenue would come from consumption, which is what they are supposed to be trying to increase.

[@JenghanHsieh]

The "Surplus" and "Savings" is highly concentrated in the top 1% rich people. To make things worse, a large portion of the Chinese put their family wealth in real estate sector, along with very high level of debt.

[@EmmanuelHemmerle]

Simply not true that the Mainland Chinese families are indebted. The problem is the reverse: they save too much and spend too little these days.

[@tobyw9573]

Paying down your plastic as well as other debt counts as savings.

[@thevindictive6145]

Why would you invest in property when its a leasehold?

[@ratsword200]

A great interview about Chinas situation without the rather unsubtle wishing of China's imminent collapse in most yt videos. Professor Pettis explains very well for layman while the hosts asks great leading questions.

[@selenajack2036]

I wonder if people that experienced the 2008 crash had it easier because this market conditions are driving me to insanity, my portfolio has lost over $27000 this month. alone my profits are tanking and I'm don't see my retirement turning out well when I can't even grow my stagnant reserve.

[@bsetdays6784]

Even in this whirlwind, there are chances to be had, thus an increase in volatility is not always a bad thing. You have an opportunity to rebalance thanks to volatility. In order to help you diversify your portfolio, you must hire a financial counselor or broker.

[@africanboi4542]

I'll suggest you create a diversification strategy because building a good financial-portfolio has been more complex since covid. Recently my colleague advised me to hire an advisor, surprisingly I have accrued over $120K under the guidance of my coach during this crash. She figured out Defensive strategies to protect my portfolio and make profit from this roller coaster market.

[@adenmall7596]

@@africanboi4542 I'm intrigued by your experience. Could you possibly recommend a trustworthy advisor you've consulted with?

[@africanboi4542]

@@adenmall7596 ​It's best you do your due diligence, I have my portfolio overseen by “ELEANOR ANNETTE ECKHAUS” and her qualifications speak for itself. Most likely, the internet is where to find basic info, she has a noticeable page for consulting.

[@lucianoboccedi]

This recommendation is coming at the right time because i am literally grasping for straws atm! I looked her up online and scheduled a phone call with her.

[@luminyam6145]

That was a great interview, thank you.

[@mrx2062]

Local governments in China do not have much money. The most taxes go to the central government. Local governments are often deep in debt.

[@heileopold6122]

Most savings came from the trade surplus from global exporters. This is now over as global exporters have no trade surplus anymore. This is also for the US a challenge.

[@luly2323]

Most western economists think China has a problem for last 15 years. Chinese economist are extremely optimistic!

[@thomasherrin6798]

Pettis thinks the problems started in 2006-2007!?!

[@alec6521]

@@thomasherrin6798 The problems with consumption became harder to ignore then. I think the problem that started 15 years ago is that debt in Chinese society exploded when China turned on the debt-spigot to compensate for falling external demand due to the GFC.

[@rap3208]

@@thomasherrin6798 Yeah, and he will continue to think china have a problem till the day he dies.

[@JasonWolfeYT]

Everyone calls the home prices in 2006-2007 a bubble. If that were true, then why did the prices reach those levels by 2010 and continue to blow past them? 2008-2009 was a temporary correction in prices that was promptly retraced and doubled.

[@allenfromalameda5691]

I watched this entire interview and feel like I learned something, but the discussion is at such a high level that I doubt I really understand it. Some things, like how Chinese households can have high savings and debt levels at the same time are very confusing. Still appreciate Jack doing his thing making seep content. Another question I have is how China’s supposed changing demographic profile will limit its ability to grow consumption.

[@allenfromalameda5691]

Deep content.

[@MsLodoss]

To put this in simple words, Chinese workers are underpaid--- Corporations are suppressing the labor cost (aka wage, because labor unions is part of CCP party apparatus) of the workers, instead use it as a way to subsidize their market competitiveness in forms of cheap labors. Now you would also think of their government the same way, it underfund their social welfare program; what should be part of transfer payment to HH, aka, the HH saving, to capitalize their infrastructure programs. In this way high level of HH saving were implicitly taken and used to increase the relative competitiveness of China in the global market.--> create a trade surplus. On the other hand the households in china now with low wage shares are very cash-strapped, with low liquidity, force on taking a large proportion of household debt in relative to the actual take home paid that they earned. on top of that, the hyperinflated real estate market means that average chinese household have to spend very large portion income in long-term debt service (mortgage payment) which further reduce their disposable income. --> this often driven the HH house in high level of consumer debt as well when you are poor/ lack of liquidity.

[@marczhu7473]

​@@MsLodossthey don't underfund that much welfare look 0 homeless. 😂

[@Wasengenyie]

​@@MsLodossincredible. You have a lot of talent to explain the complex in ordinary terms

[@RasmusDyhrFrederiksen]

Great overview and discussion

[@vickielewis3848]

This discussion is highly informative and thought provoking. Quality listening. Thank you. 🔜🇺🇲👊

[@Sokrabiades]

That was one of the best first answers to a first question I have ever heard.

[@richdiana3663]

And who's economic growth model isn't dying? Read "Limits to Growth" and be scared chitless.

[@ObeyNoLies]

Limits based on what understanding of science and technology? Do you realize what the world was like 100 years ago? Do you know how much nuclear energy is just lying around untapped? There are people in Pakistan making mud bricks for 1 penny per brick, you don't think they'd want a better life?

[@richdiana3663]

8 billion want a better life. Goodbye biosphere.

[@fredfarkle-bp9en]

Good interview I saved this to listen to on my Saturday night Worth the time

[@Leshic2]

Another good one is when he's interviewed by Kyle Bass on Real Vision. A very key point in it, is at 31:10, where Pettis explains "why you can never compare China's GDP with the res of the world's GDP"

[@pok10000]

Damn. This guy knows the stuff. I agree w him a lot. This guy prob was the mostly informed about China among every interviews uve done Jack. I'm gonna search more of his talks or writings.

[@PhonechaiSotarak]

This man is brilliant. We should hear more from him. Bravo

[@jonathanlee5185]

👍Thank you, Prof, for considering the place of poorer people within international monetary affairs. Also, there are some fascinating ideas here 👍

[@pascalxus]

Incredible. so much to unpack here.

[@candidkamerad]

Great interview, and thank you to the professor for sharing his impressive knowledge on this subject. It was riveting! 🙏🏽

[@kaycheung3749]

this video is packed with information

[@kabeerharrythakur8288]

The American feel good talk ❤❤❤

[@thomasherrin6798]

I think he talks sense, it wasn't US centric, but what an economist thinks, but they are not always right, but it appears to be the right conclusion if certain geo-political uncertainties don't rear their ugly head!?!

[@user_375a82]

Good interview - I am watching a year later. Please have him again now.

[@joedywhite8739]

This didn't age well ,so called experts.look at our inflation