Decoding China's Economic Shift: The Epic Tale of Ultra-Long-Term Bonds

In today's discussion, we delved into the issuance of ultra-long-term government bonds by the Chinese Communist Party (CCP), a significant event with far-reaching implications for China's economy and its people. Despite its magnitude, there appears to be a reluctance among financial and political circles to fully confront the matter. We explored the grand announcement surrounding the bonds, underscored by Premier Li Qiang's emphasis on their importance for China's modernization and national rejuvenation. Furthermore, we examined the specifics of the bond issuance, including maturity periods and allocation. Yet, amid the discussion, we questioned the underlying logic of prioritizing GDP growth and the issuance of bonds, raising concerns about their potential long-term consequences. Overall, today's exploration provided valuable insights into a crucial economic and political development unfolding in China.

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[generessler]

Brilliant. I have been waiting for _someone_ to mention that GDP is terrible for judging the strength of an economy without certain careful assumptions. China meets virtually none of them. Thanks for injecting this point. I hope it becomes more commonly known.

[stevenglowacki]

As someone who works in accounting, I don't understand what it means from an accounting perspective when they say that the bonds won't be included in the deficit. Debt is a balance sheet item, while the deficit refers to a negative income statement. Are they saying that the spending that is done with the proceeds of the bonds won't be considered expenses for the income statement? That's the only thing that seems to make sense, but there's no way that anyone in the real world would be able to get away with declaring that expenses paid for with proceeds from bonds don't count as real expenses.

[charleswomack]

Yeah that will work. Ensure that the provincial level to local level bureaucrats follow all of the ill-advised decisions from the top. And of course, do not allow them to improvise. And finally, essentially outlaw private enterprises via laws that make it difficult to do so without a state controlled enterprise! I wonder how this will play out?
I know exactly what will happen. Because of the sever mismanagement of the economy and a rapidly dwindling workforce, the economy will not continue to hold contract. The government will then falsely claim that they have met and in some cases exceeded the CCP's lofty goals. This is a system that is going to implode...

[pablosskates]

“Open the flood gates” reminds me of that song “Send in…the clowns…!”

[wbwarren]

What happens to these ultra long-term bonds if the CCP collapses? Will the bonds automatically default or will China still have to pay them?

[robsrockinout]

I'm very glad to have logged on and seen your live stream! Thank you Don.

[oldernu]

Blind faith in CCP central planning is like walking the plank blindfolded. You know those ultra long term bonds are going to be worthless, but you don't know when the fall will occur.

[charliex]

The "Fujian gang" should stick to running Chinese restaurants outside of China, not an entire Chinese economy, gg. 😂

[SG-jsqn]

Digging to China seems difficult, as China seems to be digging its way to hell. It has not reached bottom yet, and in fact the bottom is not yet in sight.

[omarmaynez]

IOUs from their grandchildren, never to be paid back. What a joke.

[miketan]

Borrowing in order to spend money to increase gdp without roi is a little bit crazy

[WarH]

I also have to say there’s gonna be an awful lot of new millionaires in China billionaires. This whole thing is a Bernie Madoff unbelievable.

[drtk]

Eating cakes and having them, too. Next level.

[kensmith]

My question is: who the heck would be stupid enough to buy these long and ultra long term bonds?!😮

[simonchang]

More money and more opportunity for corruption and New Millionaires.

[jwong]

in case i missed it, did your video mention who’s buying these bonds?

[mindmybusynassm]

Just about the time. Waiting already long time for ths bonds sale.
I am going to buy in value minimum 1 mln Yuan.👍

[kevinb.]

The CCP does not either have serious minded experienced economist to point out the inherent flaws in their economy and financial systems or they simply believe in their own form of self fulfilling magical economic thinking that is wholly devoid of sound economic theory and principles.

All of this is made worse because they have an uneducated, ignorant and incompetent leader in Xi Jinpjng. Much like Putin, those that serve Xi will only bring him news or ideas that appear to be favorable, however bad or unfavorable that they actually may be.

Ultimately, all the bad decisions that Xi and the CCP are making continue to grow exponentially by the day. Thus, just like building a house of cards (Tofu) it will all soon come crashing down upon them and unfortunately the Chinese people in a tragic and disastrous way.

Maoist ideology that Xi embraces will lead to another horrific chapter in the history of China and all its people. The CCP is doomed to repeat its disastrous history once again!

[weighs-n-means]

20, 30, 50? Twenty and thirty are dubious enough, but good luck to 10-year-olds who try to cash 50-year-bonds in when they reach 60!

[jamesmustin]

This is a repeat of history . The ROC printed so much paper money it could have been used for wallpaper. I guess it could have been used for
Chinese Hell Money!