Via Caixin Daily: a couple of news items and then a long comment:
China’s March factory outlook jumps as global threat looms
Chinese manufacturing activity rebounded strongly in March, signaling that the world’s second-largest economy is restarting just as it faces a growing threat from slumping external demand.
For manufacturing, the official purchasing managers’ index rose to 52.0 this month, according to data released by the National Bureau of Statistics on Tuesday. That’s up from a record low of 35.7 in February and above the 50 mark that signals improving conditions. The gauge covering services and construction was at 52.3. While the rise indicates better sentiment at Chinese factories, output remains a long way from normal.
China should just give its people cash, experts say
Chinese economists have called for the central government to provide direct cash transfers to low-income families as they find it difficult to make ends meet amid the Covid-19 pandemic.
Since the novel coronavirus broke out in China at the end of last year, millions of people have lost their incomes as factories and stores were shut down to contain the virus. While businesses in the country are now gradually resuming work as the outbreak eases, employment is taking another hit as overseas demand plummets while the virus spreads abroad.
Export backlogs grow for Chinese ventilator-makers
The coronavirus pandemic sparked a global hunt for mechanical ventilators. Spurred by soaring global demand and with the local outbreak more or less under control, Chinese ventilator-makers are now shifting their focus from domestic use to the export market.
In the 10 days starting March 19, China shipped around 1,700 mechanical ventilators to markets outside the country — about half that supplied to domestic hospitals this year, Ministry of Industry and Information Technology (MIIT) official Xu Kemin told a news briefing Monday in Beijing. As of Monday, China took orders for nearly 20,000 of the machines from overseas buyers, and a “large number” of other orders were under negotiation, according to Xu.
Imagine that: I have lived to see socialism advocated as the solution to the problems of communist China! What next, the overthrow of Czar Vladimir Putin and the installation of USSR 2.0?
The resurgence of the Chinese economy can be tracked by its CO2 emissions, as the climate site Carbon Brief has documented. But I can see another problem implicit in these news items: the ventilator gap is being treated by everyone as salvation technology, and if even North Korea could help meet global demand, it would find eager buyers around the world.
But what about routine Chinese manufacturing—the ordinary cheap consumer stuff that people line up for at Walmart (while keeping their distance, of course)? Unless global consumers have money in their pockets, China's renewed output will languish in containers on the Shanghai waterfront.
Even with oil making shipping costs effectively free, exports make no economic sense if buyers have neither the money nor the desire to spend more than they absolutely have to. Borrow more money to buy the kids Super Squirters and take them on holiday to Mexico? Don't even go there.
In the three short months since the first online rumours came out of Wuhan, COVID-19 has shaken the triumphant global economy into rubble. The collapse is ongoing, and the dust will not settle in any foreseeable future. I was born in 1941, when the US and Canada were barely emerging from the Great Depression, and unless COVID-19 picks me off I will live to see the start of the Greater Depression.
When advanced societies collapse, they don't go back to hunting and gathering. When the Mayan kings couldn't feed their people, the people overthrew them, deserted the great cities, and went back to village-level subsistence farming. Similarly, we will likely revert to (at a guess) 1920s-style industrial capitalism on a national scale, with tariff barriers and enough 20th-century-level weaponry to discourage foreign adventures against us.
That's assuming our reduced emissions ease climate change enough to let us survive foreseeable disasters for the next couple of decades: the wildfires, droughts, floods, and hurricanes...and the violence provoked by those disasters.
If the disasters persist regardless, we could be in real trouble.
