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Real Vision: Finance & Investing

Round 2: Chen Zhao And Marko Papic on China

Sep 10, 2023
Chen Zhao and Marko Papic discuss China's possible implosion, the strength of the US economy, outlook for markets, US household balance, savings rate, term premium, yield curve, and the consequences of misunderstanding China's policies.
01:06:20

Podcast summary created with Snipd AI

Quick takeaways

  • China's oversaving and lack of private sector investment hinder its economic growth.
  • India's potential as a rising economic power is challenged by the caste system and lower savings rates.

Deep dives

China's Economy and Future Growth

China's economy is facing challenges due to oversaving and a lack of private sector investment. The country's macro and micro issues, such as a high savings rate and political control, are hindering growth. While China is making efforts to pump physical stimulus into the system, it may not be sustainable in the long term. The US-China relationship remains tense, and the US is actively trying to provoke China, posing a risk to the stability of the region. However, in the near term, China is unlikely to lose its cool. On the other hand, India is seen as a possible rising economic power, but it faces challenges such as the caste system and a lower savings rate. Long-term growth in India is expected to be steady and more balanced compared to China's hyper-growth period.

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