This is a worthwhile article about the trade war between China and the United States.

This article was written by Zhihu "milk package"

In China, the problem has one imperative: more regulation and more.

2018 just into May, the country issued regulatory policy, the number of more than 115.In April alone, in a variety of national real estate control policies will total up to 33 times, with 25 cities issued policies to Hainan, Beijing, Hangzhou and other cities has issued numerous real estate developments.

Why the panic type intensive regulation?Because this is a reality:We are unique in the world as a way to counter the economic law.

Such effects are obvious:Once the failure, the real estate collapse would directly lead to the collapse of bubble economy in China;Once successful, all mankind will rewrite economics textbooks, including "Das Kapital".

(a) How do we go to the current situation?

The inescapable question is:How did we go to this when they are on the line, unable to reverse the situation?

Because the human economic development of the law:All of the economic problem could be to blame for the debt problem.From a macro perspective, the debt problem reflected in the national economy of the three major sectors: government, enterprises, residents.Among them, the government and the corporate sector's debt and leverage years of stubbornly high, a high risk of collapse.Drawn up so as to reduce both the debt and leverage, there came wave upon wave of plus lever and now this wave of deleveraging.Plus, who's the lever?Plus the residents of the lever.To Who's the lever?Go to the government and state – owned enterprises of the lever.This is a massive debt transfer process, the implementation has a very strong Chinese characteristics (other countries cannot replicate):

high real estate, the land rises to the level of government, the SOEs' control – – oriented banks, resident credit, household debt and leverage increased following higher prices in Slum monetization, implement policy cocktail – – a – days the amount of funding into the real estate, announced after 5 years of sales,Freeze liquidity – – the government and state – owned enterprises completed the task of de – leveraging, market circulation disappear, millions of millions of dollars were locked – – Super Currency Issue The problem is further hauled themselves.

Why would mention super – currency problems?This raises once again the exchange rates and prices of classic problem: keeping the exchange rate?Or keep house prices?China's huge economic size, it is almost decided by a loss of exchange and price any one would have disastrous results, therefore,Preserving exchange rates or prices in preserving this classic problem will turn to… and… the characteristics of the problem.

Obviously, printing money is unable to solve this problem, literally, in the case of Venezuela.Foreign exchange reserves of the exchange rates of currencies has been the foundation for the yuan to the currencies of the anchor.(possibly) the only effective method, only the exchange controls.However, in the 2016 – 2017 of the depreciation of the yuan, capital flight, the residents of China from 4 trillion in foreign – exchange reserves fell below $3 trillion mark for the first time;Subsequently in a strong oligopoly and a wave comparable to the Hollywood – style operation, when the renminbi depreciation expectation.But this time foreign – exchange controls, but did not become in the past is no panacea: although the value of the yuan against the dollar from 6. 9 to 6. 25, but China's reserves but only recovered less than $200 billion, but also its 2984 billion of foreign debt,Plus about $300 billion of trade surplus.While the current iPhone's $12 trillion in reserves, external debt levels have reached about 1. 8 trillion, that is to say, in fact, be able to use its foreign reserves will be a trillion.Now, with the dollar kicked off a new round of appreciation period, the RMB exchange rate has also started a seven – session losing streak, the just – released foreign exchange reserves last month than in April, reflecting a decrease of $18 billion.In this wave of dollar appreciation, if RMB exchange rate cannot be maintained in 6. 6 above, then the exchange rates depreciation expectation will come back again, but this time we have had little ammunition can be used.

On the one hand, Argentina's tragedy has served as a wake – up call, while in the other hand, in order to prevent a collapse in prices, the real estate market is huge but needs a million billion level of funding to sustain.But just at that moment, a trade war broke out.

So in foreign trade, investment, domestic demand in the troika, leaving only the domestic demand. This way. That's why on the news every day chanting the upgrade of domestic demand.However, paradoxically,Real estate as the biggest domestic demand, but occupy almost all of the other of its consumption, domestic consumption has almost become synonym of Real Estate.Thus, it would appear many fantastic scenarios: Boao forum on central bank just said that to enter the tightening cycle, but in 10 days after the announced reduction;Lian kbc6n atthe top have repeatedly underlined the room doesn't fry, Fan Gang, presented six purse.

so contradictory interests behind our policies, not only reflects the cruelty of war, also exposes a much bigger risk:Economic law of punishment, never turns personal will disappear.

(2) in the country's financial lifeline: foreign exchange, the Big Mac debt

Shares, debt, foreign exchange, Fang, these four countries is the lifeblood of the financial market.

This room is where the real estate (market).For a healthy economy, the property was not to appear in its financial transactions in the market, however, the property will be designated by the financial attribute after travelling the entire financial system – with huge energy.In this planet called Earth, only three countries had a taste of that kind of death and the enormous energy: the world economy – the top three economies in the United States, China, Japan.(In fact, many of the smaller countries tried, but because of the economy are just too small, the impact of limited.)

The U.S. subprime crisis and Japan's lost decades, finally let the Earth people gave a big boost to this evoked comparisons to the killing of tyrants energy possessed by the destructive power.And now, everybody's concerns that China is now the super – bubble, which can be regarded as the world economy to what sequela.

Stock market won't say it, say more tears welling to her eyes, almost 4,000 mark for the starting point of the journey is the lever of the inventory of the memo.

Only the currency and bond markets will be really huge volumes of our Solar System.

"First of all, the currency markets, exchange markets of a currency relative to another currency, usually with an explicit way to denote that the consent of both sides of the exchange relationship), the foreign – exchange trading volume exceeds the sum of all other financial transactions.For example, daily global securities market at about $300 billion, while the daily trading volume of nearly $6 trillion.Single countries or economies of currencies always determines the survival and development.

It is worth noting that, in this wave of yuan exchange rates fluctuations behind, there's not only China, in the quiet operation and prevent the exodus of foreign exchange, the U.S. () also has been in a stronger and more deadly strategic: When the trade war in the first round of sanctions after the success of ZTE, the U.S. will play an important role of the initiative,The dollar index has actually fallen, forcing RMB toappreciate passive appreciation.While in the U.S. trade mission to Beijing a few days before, suddenly start appreciating dollar index.This appears to be abnormal as the abnormal operation of the device in which the strategic layout in fact from 2016 to 2017 it has existed for some time,Exchange rate and trade war of the binding depth, stereoscopic, mating table of shrinking the Fed rate hike, every step seems to be a simple ordinary operation, are actually hidden behind was murderous.

And from the size of the existing trade war, "The situation is very grim.When Trump fired the first shot – for – tat trade war when the nation over the boiling, and even the Ministry of Commerce officials and economists are saying soybean, automobile, however, when the U.S. request to ZTE after the lifting of sanctions, officials and economists almost all shut up, leaving only the national champions continued at the boil.At this time, people had a gradual awakening seemingly pulled hatred all day, every day the president of a tweet, actually has a more sophisticated and long – term strategic layout.Through the trade war in the U.S. dollar index. DXY was a strategic maneuver, forcing the yuan at first, especially now the dollar index suddenly lift, wherein the financial rewards of lethality, but in the run – up to the boiling of the contending nations in submerged and invisible, few people really recognize the yuan's exchange rate is back and bigger crisis.

There is an interesting fact is that, when the U.S. delegation to China after the first round of negotiations, we cannot know the real contents of the negotiations, only in the British "Financial Times" reported that the U.S., we don't even know what this really does is actually broke down;Subsequently, the media was only issued in Washington over reports that the offer is too high.while the first round of negotiations result in:Open imported cars market, open up the market, has been shut out of the highpass – Datang joint venture, is also the speed of light.Eye on the unapologetic shout, but the body is really honest.

Seeing all this in the shoes to ask Japan's debt problems, so keep banging on that content of the individual.

First for under Japan's debt problems.Most of Japan's debt is domestic debt – holders are Japanese nationals, and ultra – low inflation in the welfare of the new policy environment, the Japanese savings rate is even higher than the Chinese, as Japan's debt holders, Japanese nationals would dump government bonds in a run of an extremely low possibility that the Japanese government.Meanwhile, Japan has the world's largest overseas asset, as well as Japan's high – tech industries and strong industrial strength, both as to its debt guarantee.

As for the U.S. debt, not to mention, first of Global Treasury issuance, but almost never does not exist a debt crisis.In fact, in Manhattan, New York has one of the famous debt clock, the real – time update of the United States total public debt, and every American family to be borne by the amount.

However, it is difficult to imagine that such debt Zhong appear in China, because it is caused by the hidden crisis which could exceed the debt crisis itself.We should say that Chinese local government debt (debt) crisis, which is a wave during the period of deleveraging.In early 2014, it had topped $24 trillion, which has ballooned into Germany's GDP.And now, including local government debt and investment debt including the debt total has reached 76. 01 trillion yuan, which is full of local debt has reached 22. 22 trillion.

The greater problem is the hidden debts of local governments.And especially the last three years, local governments borrowed by the PPP, the government purchase of services, the government investment fund and the like is formed in such a manner that a lot of hidden debt, its volumes have exceeded even managed to ensure the explicit debt.continuous rapid expansion of local debt makes everyone shiver, 2016 Oct that State Council promulgate the "regulations on local government debt risk contingency plans," said:"Local government debt is directly responsible for repaying the debt, implement the no – bailout principle kbc6n."

This is also the first time since the founding of kbc6n not bottoming the policy, no kbc6n of credit guarantee,Local governments reliance on land sales on the economy even further out of the vicious circle.So in recent years all the provinces and the revenues from land sales and rising and booming of the income from the sale of the black hole's local government debt, but still looked a little pale.In fact, revenue from 2017kbc6n deserved in 36 areas across the provinces (with the exception of Hong Kong, Macao and Taiwan), with just six provinces and municipalities directly under the central government's fiscal surplus, the surplus amounting to about $3 trillion, while the other 31 provinces and municipalities directly under the central government's fiscal deficit was 5 trillion and a total breakthrough;Wherein this fiscal gap had reached as high as 2 trillion.

In the long term continuous running at a rate of development, current local government debt has reached a very dangerous 22 trillion.March 2018 at the Ministry of Finance Circular on 2018 local government debt management notification "is set in the total amount of local debt ceiling, 2018 limit is approximately 21 trillion.April, Xinjiang is a representative of a plurality of PPP projects in the provinces has been halted.The first seems to come.

There is also a class of debt also thought – provoking.In all first – class industry, first is the debt of banks, the second silver of the non – financial, debt – to – third of the industry?Engages in real estate.April 2018, a real estate company's overall debt ratio of 79%, near record highs of the past 13 years.Wherein nearly 20 companies whose debt exceeded 85%, 84% of Vanke's debt – service ratios, also a record for the company's record.Actually, currently have even his own mother didn't know was the sky – high housing prices, developers are also very worried, especially in Evergrande, Wanda's overseas investments after the event, after killing the King of the Monkeys sensationalistic formula of strong under the supervision of asset transfer path are severely limited.While these highly leveraged asset of RMB, faces from time to time by the winding – up of risk.

(3) "freezing" with the property tax

2018 of the real estate market, is said to be a chaos of Huansheng, lot of wonders can even make the "Das Kapital" in the relations of production, production resources, market price – – are out of the failure, if the writer can reach out across time and space to now, perhaps a great number of content are to be rewritten.In the author's writing Das Kapital in the course must have studied Dutch tulips to hype the event, however, any one of the last 400 years, frying the madness of tulip bulbs (then a rare tulip bulbs may be any regions of the Netherlands in exchange for the house, luxurious decoration) + permanent property,I'm afraid not enough for the author's understanding in today's Beijing or Shanghai, people in the eyes of desire and anxiety.Do you really think this production is to be understood that the degree of mismatch of resources?

2018, queuing, queuing, the wagging – number, increasing lending rates, rob people, etc. and seemingly battle scene of chaos, but there is a clear message:Entering the market.

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