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Nouriel Roubini and Patrick Chovanec EconoMonitor Video – China: How Much Stress Can the System Take?

Patrick Chovanec, associate professor at Tsinghua University’s School of Economics and Management in Beijing, China stopped by the RGE offices in NY for a discussion on the likelihood of a hard landing in China and we consider the short and medium term implications of policy adjustments, leadership transitions, and technology advancements. [22:20]

[2:25] – How much of a deceleration is to be expected?

[4:50] – Which policy route will China take and will they be able to achieve 8% growth for the year?

[8:00] – Will China be able to provide stimulus fast enough, or will this year’s growth be below consensus?

[10:20] – What will exchange rate policy look like and will we see an increase in trade tension?

[13:50] – A look at the medium term outlook and the leadership transition.

[16:00] -  Will China avoid a hard landing?

[18:18] – With social and political instability spreading around the world often facilitated by social media and other new technology, what’s the risk to the system?

13 Responses to “Nouriel Roubini and Patrick Chovanec EconoMonitor Video – China: How Much Stress Can the System Take?”

Roubini / Chovanec « Patrick ChovanecFebruary 9th, 2012 at 2:15 pm

[...] I’ve been traveling in the US — Chicago, New York, DC — on a very intensive schedule (7-8 meetings a day), so I’ve barely had any chance to write.  However, I did get a chance on Tuesday to sit down for a brief chat with Nouriel Roubini about the current state of the Chinese economy.  You can watch that conversation (approx. 22 minutes) on his blog here. [...]

donnaFebruary 9th, 2012 at 7:17 pm

very intristing and right..every time i read or lisstening pr.CHovanec Look to likE he read my mind.. ok this year will change the system economic in world for good i believe. Chines people from history is ''HART WORKING''and this is force who send the economy in evolutin….CHine have winn and from Globalisem ..i don't know how can keeped all this success but for now is good…THANK YOU

Ping ChenFebruary 16th, 2012 at 8:00 am

Chovanec knows well about the surface of Chinese economy but failed to grasp the internal dynamics of China's economy. His looking glass is shaped by equilibrium thinking of neoclassical economics, which failed to understand financial crisis and failed to understand the rise of China economy. China's rapid restructuring is driven by a series of crisis and challenges. For linear thinking in the western armchair economics, instability and crisis is always bad thing. But in Chinese culture, crisis means 危 (danger) + 机(opportunity). All Chinese great leaders and reformers came out from crisis.
As my mentor Ilya Prigogine used to say: order out of chaos. The reason China is more flexible than US in dealing crisis, is that when US politicians play game of words Chinese officials already start a new round of innovation competition. You may go to visit
Chong-qing or read my comment at: http://en.nsd.edu.cn/article.asp?articleid=7191
Ping Chen at Peking and Fudan University, author, Economic Complexity and Equilibrium Illusion, Routledge, London (2010), the last chapter was my analysis of crisis at Australia meeting in 2009.

William LattaFebruary 16th, 2012 at 6:28 pm

To Mr. Ping Chen;
We shall see if you are correct soon enough. For your sake and that of your people I hope you are but I suspect you are not right and are in for some difficult times ahead. Those who pay the price for foolish political economic decisions usually change leaders once they feel the magnitude of the economic crisis. I agree with your assessment that a crisis = danger + opportunity. Those that endure an economic crisis usually see only the suffering and frustration caused by the crisis and rarely the opportunities it creates. Frustration leads to anger.

Michael E PicrayFebruary 17th, 2012 at 7:39 pm

"Crisis – challenges"
Crisis – millions of Chinese workers unemployed. Challenge – find them work.
Resolution = build cities large enough for millions to live and work in that no one lives or works in (aka "Ghost cities").

"The reason China is more flexible than US in dealing crisis, is that when US politicians play game of words Chinese officials already start a new round of innovation competition."

You are correct. US politicians would never think to build ghost cities. You win.

Weekly Round Up February 22 – 2012 | Connect the DotsFebruary 22nd, 2012 at 5:49 am

[...] Nouriel Roubini and Patrick Chovanec – China: How Much Stress Can the System Take? – “Patrick Chovanec, associate professor at Tsinghua University’s School of Economics and Management in Beijing, China stopped by the RGE offices in NY for a discussion on the likelihood of a hard landing in China and we consider the short and medium term implications of policy adjustments, leadership transitions, and technology advancements.“ [...]

Uday ChatterjeeMarch 1st, 2012 at 7:37 am

From a macroeconomic viewpoint,the present global crisis is driven by a culture of rampant overconsumption.No long term solutions can evolve unless we make fundamental changes in our lifestyle.Unless there is broad consensus in the world on volutary moderation in consumption-the crisis is here to stay and hopefully grow into a full blown catastrophy.

MarceloMarch 6th, 2012 at 3:12 am

Incredible growth has been based on real estate gambling, as of late. This bubble will burst but the movement of millions to the city and eating and living better will continue to grow, internally, by very large (comparative) margins. China will feed and grow on itself. The rest of the world will suffer.

mannfm11March 6th, 2012 at 6:33 am

China has flushed their wealth down the toilet. We just haven't seen the bill yet. I have read 60% of its economy is fixed investment of private and public works. How can they shut that down without having a depression. They have destroyed their farm land in building all this stuff and pollution and water supply is a problem.

inversion tablesMay 16th, 2012 at 5:47 pm

Patrick Chovanec, associate professor at Tsinghua University’s School of Economics and Management in Beijing, China stopped by the RGE offices in NY for a discussion on the likelihood of a hard landing in China and we consider the short and medium term implications of policy adjustments, leadership transitions, and technology advancements

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