# China's $586b stimulus package



## sammy84 (10 November 2008)

http://money.cnn.com/2008/11/09/news/international/china.package.ap/index.htm?postversion=2008110908

What are peoples thoughts on this? Seems a very large amount for a country which was still projecting growth between 8-9%. Nevertheless I imagine this can only be good news for the miners, as it seems that most of this money is going to spent on infrastructure.


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## nick2fish (10 November 2008)

Well they need it and they will be playing catch up for a while to come IMO
But the most important point is  They are doing it because they Can!!! a great position to be in.

Battered and bruised Hedge funds manipulating commodity markets  

Wait till reality takes hold, then we may have a more realistic take on demand


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## weirluo (10 November 2008)

nick2fish said:


> Well they need it and they will be playing catch up for a while to come IMO
> But the most important point is  They are doing it because they Can!!! a great position to be in.
> 
> Battered and bruised Hedge funds manipulating commodity markets
> ...




Cheap resources provide a good oppotunity for CHina to further industralize and generalize.

How much miners are to benifit? Not much. China was blamed for high oil/other resources price until August this year, while its demands so far hasn't dropped much, the curde oil price for exampla has gone down to 63 as today from 140. Now everyone hopes it's driving the price/whole market up? Give it a break. China has a big need of resources, but the world is much bigger. China is lucky to have a good run itself.


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## Pairs Trader (10 November 2008)

About time they did something, they do have 1.4 trillion USD in reserves that they want to re-deploy out of US treasuries into more agressive & diversified assets, this looks like a smart play by the chinese.


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## sammy84 (10 November 2008)

weirluo said:


> Cheap resources provide a good oppotunity for CHina to further industralize and generalize.




Yeah that's a good point. I have a feeling that this stimulus package will mark establishment of China as the worlds largest superpower.


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## dhukka (11 November 2008)

A $586 billion stimulus package or just rearranging chairs on the titanic?




> *China’s Stimulus Plan Is No Such Thing*
> Paraphrasing Nixon, have the Chinese become Keynesians now, too?
> 
> I don’t believe so.
> ...


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## KFC soup (12 November 2008)

think it's in the right direction.
all government should move the infrastructure needs for the next 10 years forward to the next 2 years. at least then they can keep the the unemployment figures from rising.

hopefully this becomes mainstream at the g20 meeting

what's buggering me is, our politicians are talking about cutting infrastructure spending in a economic crisis. 

let's have a negative budget now! we can make up for it in a year time.


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## jeflin (12 November 2008)

The stimulus package may be insufficient to reverse the global slide. Oil has fallen below $60 and other commodities are suffering the same fate.


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## wildkactus (12 November 2008)

China needs to do this as anything under 9% growth for china is a recession.
We are Starting to see this now, there has been about 3000 factory closures so far in the pearl river delta, mainly in cheap goods (clothing, toys, shoes, etc). This is also a good thing as it gets rid of the fly by night operators, and make the other factories get there duck in a row.

unemployment will be a problem in some of these delta cities. Dongyuan is an example, was there last week and in some places it is a ghost town, where last year it was hard to get a factory unit, now it's take our pick.

on the other side they need to keep up with the infrastructure projects, power and water are the big ones, a lot of places have manatory days of no power for factories and even then it goes out for no apparent reason on the other days.
Then there are the new roads, airports, rail lines, ports, that need to be built and maintained just to get all the people across the country connected. 
They have come a long way but still have a long way to go.

China it just keeps changing by the day.


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## Flip (12 November 2008)

I am subscribed to the Euro Pacific Newsletter. please remove this post if it is spamming but I thought it was kinda relevant. 



> China's Stimulus Spells Trouble for U.S.
> 
> This week, Asian markets were initially energized by China's announcement of a near $600 billion economic stimulus package for its own economy. Although I have never been a fan of government-fueled stimuli, the relative wisdom of the plan hinges on the source of funds the Chinese government decides to utilize. Their best choice would be the country's nearly $2 trillion in foreign reserves, the largest portion of which is held in U.S. Treasury and agency debt. This pile of dollars, which really amounts to no more than a subsidy for U.S. consumers, does nothing to benefit Chinese citizens.
> 
> ...


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## sinner (13 November 2008)

Flip said:


> I am subscribed to the Euro Pacific Newsletter. please remove this post if it is spamming but I thought it was kinda relevant.




LMAO! Peter Schiff vs the other dude, who must be eating some serious humble pie right now. I recommend everyone watch this youtube link! 

They are laughing at him like hes crazy.


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## Ageo (13 November 2008)

WOW that video was insane (and fantastic) i cant believe every so called expert was against Peter and they were taking the piss out of him (laughing etc...) hehe Peter is the man and to think he's Ron Pauls advisor the 2 cant get any better.

Highly recommended.


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## sinner (13 November 2008)

Just found this regarding the bet made in the above video

http://www.youtube.com/watch?v=z3WjgKUf-kA&feature=related


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## Ageo (13 November 2008)

sinner said:


> Just found this regarding the bet made in the above video
> 
> http://www.youtube.com/watch?v=z3WjgKUf-kA&feature=related




lol typical loser, did you see when they asked him about the bet he shrugged his shoulders as if to say "did i make a bet?" Art Laffer is a good guy to listen to so you can do the exact opposite. And to think he has advised past presidents!


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## drsmith (13 November 2008)

Peter Schiff and China's Economy Hard Landing.

http://www.marketoracle.co.uk/index.php?name=News&file=article&sid=7223


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## c-unit (13 November 2008)

Haha. Peter Schiff is the man, thats for sure.

Can someone answer this question for me though please. China has been building up these foreign reserves over the past decade through such large trade surpluses...then how does the Chinese government get their hands on it? Shouldn't the reserves be owned by the private sector? Or is the difference between public and private sector in China less clearly defined than the developed Western economies?


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## mark_au (13 November 2008)

Ageo said:


> WOW that video was insane (and fantastic) i cant believe every so called expert was against Peter and they were taking the piss out of him (laughing etc...) hehe Peter is the man and to think he's Ron Pauls advisor the 2 cant get any better.
> 
> Highly recommended.





Indeed, this is a truly amazing video, i can believe how arrogant some people are...


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