China is now 2nd largest economy

[RandomGuy]

10% Growth will do that.
Still be a while before their economy supasses that of the US (2050 or so by my reckoning)



Second in line
[Economics: Free Exchange blog at the Economist.com website] (http://www.economist.com/blogs/freeexchange/2010/08/china_0)


CHINA has, at long last, surpassed Japan in terms of nominal GDP, making the Chinese economy the world's second largest. Second quarter output in China came in at $1.337 trillion, to Japan's $1.288 trillion (Japan's output was larger in the first quarter; for comparison, America's second quarter nominal output was $3.522 trillion). The shift is sure to be widely discussed and widely misinterpreted. There are a few key things to mention.

First, while Chinese growth has been truly impressive in recent decades, the rapid overtaking of the Japanese economy also reflects years of disappointing growth there. This story is as much about Japan's travails (and the risk to other rich economies facing a descent into Japanese-style stagnation) as it is China's boom.

Second, China remains a very poor country in per capita terms. It uses over four times as many citizens as America to produce less than half America's output. That's a bit misleading—urban productivity in China doesn't lag America by quite as much but is offset by the limited growth contribution of China's hundreds of millions of rural poor. Still, the total output figures encourage observers to vastly overstate the developmental level of the Chinese economy.

And third, significant challenges remain ahead. As Eswar Prasad says:

There are virtually no historical parallels for a country that is so large and dominant in absolute terms and yet that lags far behind many other countries in terms of per capita income and other indicators of development. There is still a yawning gap in per capita income levels between China and the advanced economies and, even at present growth trajectories, it will take a generation for China to achieve the level of development of advanced economies.

Growth in China has led hundreds of millions of people out of dire poverty and is cause for celebration. But the process of transition is going to continue to be a difficult one for China and the world.

[TDMVPDPOY]

gdp output i prefer quality > quantity...

the last item u bought was probably made from china, how long did it last you?

[pawe]

Yeah, but they're fucked since they are running out of women to marry. Expect the rise of order#6 cream of sum yung guy soup in China pretty soon.

[Goran Dragic]

If you can the fact America owes them trillions upon trillions of dollars, they're easily the biggest economy in the world, unfortunately every president since 1980 other than Bill Clinton doesn't really understand the concept that you try to avoid spending money you don't have (including Obama).

[TDMVPDPOY]

If you can the fact America owes them trillions upon trillions of dollars, they're easily the biggest economy in the world, unfortunately every president since 1980 other than Bill Clinton doesn't really understand the concept that you try to avoid spending money you don't have (including Obama).

lol wtf are they going to do if u not going pay up?

[DarkReign]

If you can the fact America owes them trillions upon trillions of dollars, they're easily the biggest economy in the world, unfortunately every president since 1980 other than Bill Clinton doesn't really understand the concept that you try to avoid spending money you don't have (including Obama).

Um, no, theyre not.

BTW, America doesnt owe them "trillions and trillions", its more like ~$1 trillion, give or take (still huge).

Moreover, even if you added the debt America owes to China in last year's total GDP plus interest, theyre still a loooooong way off from the US.

[Veterinarian]

If you can the fact America owes them trillions upon trillions of dollars, they're easily the biggest economy in the world, unfortunately every president since 1980 other than Bill Clinton doesn't really understand the concept that you try to avoid spending money you don't have (including Obama).

Actually it was really the Gingrich led Republicans who were responsible for balancing the budget. Clinton just signed off on their idea after making a few changes and took the credit. Of course as soon as someone finds an excuse to bomb somebody Republicans go nuts with deficit spending.

[Cry Havoc]

If you can the fact America owes them trillions upon trillions of dollars, they're easily the biggest economy in the world, unfortunately every president since 1980 other than Bill Clinton doesn't really understand the concept that you try to avoid spending money you don't have (including Obama).

For starters, Clinton greatly increased spending in many areas of the government, because he realized that the economy is so complex that it's impossible to attempt to summarize it in half of a paragraph. Nice effort, though.

Secondly, we owe China around $770 billion right now, which is a lot, but far shy of what you are stating, and is even less than half of the difference between our economies over three months. So we could technically pay them back with a single month's GDP. That's pretty acceptable as far as debt goes.

And lastly less directed at you and more to the article: China reminds me of a young Soviet Union. They are forcing industrialization and infrastructure without regard for (and sometimes, at the expense of) the populace.

Much of China's vast economy right now rests on two principles: MASS production and cheap labor. The problem with this is that it is simply not a long-term sustainable model for economic prosperity. You're essentially building a huge skyscraper while using wood and tin for the foundation. And I don't see them changing that anytime soon, because they have too much nationalistic pride to admit they could have done things better.

So yes, for the time being and the conceivable short to medium-term future, China will enjoy it's name in lights next to "Largest Economy". However, the much more important statistic IMO, is the "Best Country to Live In", and I don't see China cracking even the top 50 in that for a long, long time.

In short, it's a rich, brutal place to live where the government would rather put on a pretty face (See: 2008 Olympics) for the world than actually do things the right way. They're similar to North Korea (although not as insidious), with the advantages of having a landmass the size of the US and enough people to repopulate the entire world if necessary.


Actually it was really the Gingrich led Republicans who were responsible for balancing the budget. Clinton just signed off on their idea after making a few changes and took the credit. Of course as soon as someone finds an excuse to bomb somebody Republicans go nuts with deficit spending.

Amazing how quickly times change.

"Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. This is not a way of life at all, in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron."

A republican said that, and just half a century ago. He also happened to be a 4-star general, and president.

[v2freak]

^Excellent post. There are so many problems with that place that I wouldn't even visit there. Their government just scares the crap out of me, and yea the things I buy from China or Hong Kong don't last past 2 weeks.