I'm not alone in my doomsaying

I receive regular e-mail newsletter highlights of the RGE Monitor, a subscription news service of in-depth economic analysis headed by the formidable Nouriel Roubini (who was predicting the 2008 crash in some detail more than three years before it happened, and at the end of 2009 was ranked #4 in a list of 'The World's 100 Most Influential Thinkers' by Foreign Policy magazine [although they put Ben Bernanke in 1st place, so it's obviously a bit of a cockeyed ranking!]).

A couple of weeks ago, Mr Roubini warned of "a potentially destabilizing contradiction between China’s short- and medium-term economic performance". He went on, "The economy is overheating here and now, but China’s overinvestment will prove deflationary both domestically and globally."

In the current edition of Foreign Affairs, predicting fragmentation of the world order and increasing zero-sum competition between nations, he has observed that the emerging economies of Brazil, India, and China are "far too focused on domestic development to welcome the burdens that come with new responsibilities abroad".

I almost start to feel like a China-optimist by comparison....

I gather Mr R has also said - regarding the attempt by numerous governments to avert or ameliorate recession with massive spending programmes - "There's no such thing as a free lunch, especially when you have to pay for it."  (No, sorry, that must have been Yogi Berra. But Roubini has said something very similar.)

The Fifth Day

Over this fortnight and more of firework craziness that is the Chinese Spring Festival there are certain days that are crazier than others.

It's hard to discern any significance in this, since the pattern of firework usage isn't very consistent from one year to the next, or one day to the next.

However, over my many years here now, I had noticed that the fifth day of the festivities is almost invariably one of the heaviest gunpowder days.

Apparently it's because it's the traditional birthday of Guan Yu (or Tsai Shin Yeh), the God of Wealth. And he likes fireworks (so they say)!

I maintain that overall this has been a pretty wussy year so far for the exploding of ordnance on our streets. I'm not sure whether there were any government-sponsored meltdown-counteracting incentives to firework purchasing in place last year, but I gather the market in Bejing was much more competitive than it had been for some time, with three or four major wholesalers going toe-to-toe for the first time and getting into a vicious price-cutting war. This year, it would appear, fireworks are quite a bit more expensive, and people have been showing some restraint.

Concerns about last year's torching of one of the new CCTV buildings (almost certainly arson, but that's another story) may have been mildly inhibiting too: firework bans are back in place in a number of major public spaces and near important buildings (hence, unfortunately, the Bell Tower Square - minutes away from where I live, and a great place to watch the madness last year - has been dead this time around).

Even on New Year's Eve..... well, things were INTENSE for fifteen or twenty minutes either side of midnight; but usually that period of non-stop mayhem lasts two, three, four hours, dragging on well into the following morning. This year, things were fairly sedate again by 12.30am.

This has been the quietest Chinese New Year I've known in Beijing (since the 'firework ban' was lifted.... four years ago?).

Well, until tonight..... Day Five. I was woken by firecrackers at 10 this morning, and it's been going on sporadically all day. Once darkness fell, things got batshit crazy. Seems like people were maybe reining themselves in a little on New Year's Eve so they could do Guan Yu's birthday in style.

There is so much shit blowing up outside my study at the moment that I genuinely fear for my windows. There is a powerful whiff of gunsmoke in my apartment, even with all the windows firmly closed. I'm doubting whether it's going to be feasible to get much sleep tonight...

A boy needs a hobby

The latest gem from the recording studios.....     "What did you do last weekend?"   "I went to the farm to watch the vegetables."     Now, it's tempting to suppose that this is just another instance of the common Chinglish inability to distinguish between watch and see (and indeed look at).  One verb is usually enough for the Chinese, so they tend to use see for all instances of vision.  But even "going to see (or look at) the vegetables" is a bit of an odd thing to say.  Where is the fascination in viewing inert objects which could satisfyingly occupy even an hour or so, let alone a whole weekend?   And there were two or three instances of this curious idea in our scripts today, all occurring within a general theme of 'hobbies & interests'.  (The Chinese are BIG on hobbies & interests - but never, alas, pastimes - and you are considered a social deviant if you don't have one; collecting something is pretty much compulsory, even if it's only pencils.)   So, watching vegetables, it would seem, is now being promoted to the nation's middle school students as a worthwhile leisure time activity.   It will probably become an official job designation soon.  If a few tens of millions of peasants become full-time 'vegetable watchers', the unemployment problem will be solved.       And I get to see these great shifts in social policy right at their inception.  It is one of the few things that makes recording educational materials a satisfying job.

Beastly numbers

I came upon an intriguing - but rather disturbing - fact in the article I just mentioned in that little rant on statistics a moment ago.   How many new jobs were created in China in the first half of this year?  6.66 million, according to the official government figures.   It's rather too suspiciously round a figure, isn't it?  Let's not get into all the 'Book of Revelations' imagery associated with it!   As I've observed before, one can't really trust any official statistics coming out of this country - partly because people will lie so freely to promote a desired image, and partly because statistical methodology is so slapdash.  (I rather suspect, also, that there may be a problem with the Chinese language itself - or at any rate with the culture of thought that has grown up here - that fosters an extreme conceptual woolliness, which often seems to swamp analytical thought or attention to detail.  People often just don't seem to notice that the statistics they're quoting are implausible, impossible, inconsistent, undefined, devoid of crucial context, meaningless.)    You see, they don't actually explain what that figure is.  How are 'new jobs' counted?  And are they counted in isolation (I rather think so!), or offset against the number of jobs lost?   Even if this really is the total of jobs added to the Chinese employment market, the surplus of newly created jobs over lost jobs.... well, it's still not very much, given the size of the country.  And given the fact that the 'official' figure for the annual increase in job-seekers (probably assessed very conservatively, if not wilfully misrepresented) is 20 million.   Any way you look at it, there are a lot of folks without jobs here at the moment.

Mac attack

This morning I happened to read a news item online about Iceland's economic crisis forcing McDonald's out of the country (hurrah!).   This reminded me of the 'Big Mac Index' sometimes used as a lighthearted way of comparing the cost of living in countries around the world.  I gather the idea was originally started, and is still continued annually, by the financial institution UBS; but in the past decade or so, The Economist's version has probably become more widely known.  I'm not sure where to get hold of a full version of the UBS country list (not on their website, as far as I can discover), and The Economist's is only available to subscribers (although the latest list appears to have been pirated - or perhaps reprinted with permission? - by the Oanda exchange rates website here).   Also, at present, this related index on how long it takes to earn a Big Mac in different countries is available free on The Economist website (although the stats come, in fact, from UBS).   There's a little interesting background on the UBS and Economist indices on Wikipedia, and a good article explaining their significance can be found here.     I suppose we should count ourselves lucky that here in China we still enjoy (hardly the right word) one of the world's cheapest (exchange-rate adjusted) Big Macs.  When there was a big spate of McDonald's openings shortly after I arrived here 5 or 6 years ago, I think the Big Mac was originally priced at around 18 rmb; but that proved too much for the local market, and the price was soon slashed back to 10.50 rmb.  In the last year or so, it's crept up again by small increments, and it's now about 12 or 12.50 rmb.  Not much over USD 1.50!  Of course, you might not get quite the same experience for your money here, whatever the Franchise Lords back in Illinois protest: the quality of the meat here is quite atrocious (yes, even worse than in the US), and the service is often extremely slow.   Not that I really wanted to talk about hamburgers anyway.  No, this was all just preamble - to introduce a post I just wrote over on parallel blog Barstool Blues describing my similar (but far more useful) idea for the Beer Equivalence Index.

The end of an era

As if it's not bad enough that nearly a third of the pubs I remember from my Oxford student days are now lost to us, I learned on my recent trip back there that all of the city's secondhand bookshops have closed, or are about to very shortly (well, all except the secondhand department of the venerable University bookshop, Blackwell's, and one or two charity shops).

The global recession has hit publishing particularly hard, it seems (god damn, the scourge is hitting America too); but I gather the pressure on secondhand bookstores has been gathering for some years now. Many people, it seems, prefer to buy their books online these days. I really don't understand that. I mean, I can just about see the convenience argument for buying new books from Amazon, because with that kind of purchase you probably already know what you want. Random browsing is key to the secondhand bookbuying experience, however. When I go into a secondhand bookshop, I have no idea what I'm going to come out with - but I'm pretty sure I'm not going to come out empty-handed. The pleasure lies in ranging the shelves for an hour or two, searching for hidden, unguessed-at, unknowable delights. Oh, the modern world! We foolishly venerate the false idols of Efficiency and Convenience, and, in doing so, cast aside so many subtle joys.

This passing of the bookshops is particularly grim news for my old friend, The Bookseller, who suddenly finds himself being forced to embrace a career change in his forties. He's muttering vaguely about applying to some public libraries. I hope that works out for him, but it will still be quite a jarring culture-shift. I think he may need some counselling.

So may I. I don't know what I'm going to do with myself on trips back to Oxford from now on, if I can't fritter away an afternoon here and there in his bookshop.

Olympic leftovers (3)

During the Olympic summer last year I commented a number of times on the "x-ray" scanners that had been introduced at all the subway stations (commenting mostly on what a complete waste of time they were!).

I had expected that they would be de-commissioned, sold off within a few weeks of the end of the Paralympics (well, in a sensible world, they would have been hired rather than bought; but I'm sure several people received generous hong bao [the little red envelopes in which the Chinese traditionally hand over gifts of cash] in return for authorising this massive purchasing programme). And, for a little while, it did appear as if this were going to happen. Most of the extra security staff who'd been filling the subway ticket halls during the Olympics disappeared; without the throngs of 'guards' hustling people towards them, the scanners were effectively falling into disuse; sometimes the scanners themselves were now left unmanned; several were mothballed, draped in foil-covered blankets; in a few places, I think, they'd actually been removed.

But then.... the blankets came off, the machines were put back into use, more security staff appeared again (not as many as last summer, but many more than last autumn) to operate them, and to bring them to passengers' attention (many of them are sited in really stupid positions, not on a convenient path through the station, and sometimes not even readily visible).

Is there some new terrorist threat the authorities are seeking to respond to here?

No, I think not. It's just another phoney job creation scheme, another sign of 'meltdown' desperation.

Not reassured

I caught a glimpse of Ben Bernanke on TV the other day, trying his best to be bullish about the economy - in his usual, measured way.

The gist of his message seemed to be: "if" the wheels don't come off anything else now, and "if" the stimulus package takes hold, then we "might" see the beginnings of an upturn by the end of year.

Hemmed around with all of those qualifications, it didn't seem like a very encouraging speech at all. And, to my mind, he didn't look or sound as if he believed a word of it anyway.

But then, of course, I am firmly on the side of the doomsayers about this one. Away with your sham optimism, Mr B!

Possible outcomes

Time for a bit of Wilfred Owen again, I thought to myself.

The Chances

I mind as 'ow the night afore that show
Us five got talkin', - we was in the know.
"Over the top to-morrer; boys, we're for it.
First wave we are, first ruddy wave; that's tore it!"
"Ah well," says Jimmy, - an' 'e's seen some scrappin' -
"There ain't no more nor five things as can 'appen:
Ye get knocked out; else wounded - bad or cushy;
Scuppered; or nowt except yer feelin' mushy."


One of us got the knock-out, blown to chops.
T'other was 'urt, like, losin' both 'is props.
An' one, to use the word of 'ypocrites,
'Ad the misfortoon to be took be Fritz.
Now me, I wasn't scratched, praise God Almighty
(Though next time, please, I'll thank 'im for a blighty).
But poor young Jim, 'e's livin' an' 'e's not;
'E reckoned 'e'd five chances, an' 'e 'ad;
'E's wounded, killed, and pris'ner, all the lot,
The bloody lot all rolled in one. Jim's mad.

Wilfred Owen (1893-1918)

And this in turn set me to pondering on how this global financial crisis is going to go. I am something of a pessimist on this; all the more so since attending a rather eye-opening panel discussion on the topic with some leading economists and business analysts a few weeks back. After that, I was even more inclined to concur with Paul Denlinger's analogy in this recent opinion piece on The China Vortex: "Taking all the bad leveraging out of the system and replacing it with cash and credit liquidity is like trying to rebuild the engines of an aircraft in flight. It cannot be done. This means that there can only be a crash."

The crisis in sub-prime mortgages and the concomitant collapse of the housing market is, I gather, after all comparatively small potatoes. The failure of so many mortgage-backed derivatives was merely the first domino in what threatens to be an endless chain reaction. The crazy, untenable level of debt leveraging built up in the world financial system during the Noughties has been exposed - credit default swaps totalling over US$ 60 trillion, and still growing - but no-one seems to have any idea what to do about it. All the vaunted "stimulus packages", throwing money into the world's economies to try to counteract the drastic shrinking of credit and confidence in the money markets, is, at best, treating the symptoms and not the cause (and probably not even treating the symptoms very effectively).

Every month or two AIG will threaten to go under; every month or two the US government will give it another bailout that's not enough to keep it afloat for good. Governments around the world are underwriting financial institutions to an unprecedented extent, but - unless something pretty radical is done soon to try to unravel the skein of bad debt in which the banking system has enmeshed itself - some of those institutions are surely still going to fail. What happens when people start to lose their trust in treasury bonds? What happens when even the governments of the wealthiest nations simply can't raise any more money? I rather think we may see in the coming few years not just the collapse of more commercial banks, but the collapse of central banks, governments, countries - a descent into anarchy. (Apparently, over 90% of these 'credit swaps' are entirely inter-bank affairs, and so should to a large extent cancel each other out..... if only the banks could agree on a programme of settlement; but that is unlikely to happen because the situation is so complicated; because no-one is willing to contemplate writing off 'assets' on that kind of scale; and because, while some banks might survive and grow stronger as a result, many more would be destroyed by the exercise.)

It bothers me that people are still maintaining a hollow optimism about this situation - underplaying the crisis as merely "one of the worst in history" or "the worst in living memory" or "almost as bad as the 1930s". To me, it looks as if it is already quite definitively the worst financial crisis in history; and it has the potential to get much, much worse. The Wall Street Crash of 1929 led to more than a decade of worldwide recession and precipitated a world war. And, make no mistake about it, this crisis is worse.

So, the 'chances' we really ought to be considering are:

5-10 years of severe economic downturn, with all of the attendant social distress

Partial or complete collapse of the world banking system (but most governments able to continue - with difficulty - to function??)

Collapse of central banks and/or governments in many countries

Small regional wars over natural resources

Major conflict between (no longer so 'super') superpowers

These are all, I fear, very real possibilities for the decade ahead of us. I hope that the ones further down the list are fairly remote possibilities, possibilities that can be averted by prudent leadership. But the "all rolled into one" option of 'madness' - the collapse of society as we know it, global anarchy - is not as remote as one would wish. It could happen, unless we are careful; and unless we are lucky. By comparison with that, 10 years of recession really ain't so bad.

Ominously quiet....

The building site outside my window has been completely shut down since a week or more before the Chinese New Year holidays - over a month now.

It is now 10 days since the official end of those holidays, and there's still no sign of life there.

I worry that the project may have been abandoned - a conspicuous victim of the 'meltdown' right on my own doorstep!

I know it may seem paradoxical to complain about this, after all the griping I did when they started this work back in October, but..... well, I had got used to enduring the 24-hour noise outside, and I was rather looking forward to the dratted work being finished. I don't want to have to look out on this eyesore indefinitely.

[And yes, it's been snowing in Beijing for the past couple of days. The Spring is threatening to be even more schizophrenic than it has been in the last couple of years. The first half of February was uncommonly mild: the daytime temperature got up into the 60s Fahrenheit a few times last week. This week - arse-freezing again! And the first snow of the year! 5 more weeks until it's really Spring, I reckon. 5 more weeks....]

The government is doing its best to HELP you

I just saw a story on the TV news here that the Beijing government has set up a 'job fair' outside one of the main train stations.... to assist arriving migrants in finding work.

Allegedly.

I figure most of these people find work readily enough through family contacts already here, or through the freelance employment agents who circle the train and bus stations like vultures. Assuming there is any work to be had, that is.

No, nasty old cynic that I am, I am inclined to suspect that this is more of a social control measure - trying to establish a more accurate register of migrant workers arriving in the city so that, if there is a serious shortfall of new jobs ('if'???), they can be easily rounded up and sent back home.

Then again, maybe it's more just an empty propaganda exercise. I imagine these new arrivals don't have any contact details to give out (with any luck, they've arranged to crash with family or friends - but they might not know the address, and probably wouldn't want to give it out to government representatives anyway). Most migrant workers have a very precarious and sub-legal status here: without valid Beijing residence papers, which very few of them have or can get, they are subject to fines or detention at the drop of a hat. I am therefore very dubious as to how many of them would sign up with a government-run employment registry.

Still, all this talk of caring for and helping the migrants is very uplifting, isn't it? Help with finding jobs. Help with re-training (wonderful shot of beaming peasant, quite probably illiterate, flicking through a booklet on safety procedures in the building industry, seeking out the illustrations, looking at them rather bemusedly; perhaps he's already worked in construction for several years and has never seen a safety harness.....). Gosh, they might even make them eligible for healthcare and education one day. And remove that threat of arbitrary arrest. One day.

In the midst of all this rather unconvincing happy-clappy stuff, there was one chilling statistic: a spokesmen for the government employment agency said that they had details of 30,000 jobs available..... but they needed to find 100,000 more.

As is usual with the Chinese handling of statistics, no parameters were mentioned. What's the timeframe there? 100,000 jobless peasants have arrived in Beijing in how long???

Yes, somewhat alarming.

I am becoming increasingly unsettled by the unaccustomed (perhaps inadvertent?) candour we've been seeing on CCTV9 items about the economy in the past month or so. Even Yang Rui's Dialogue, a talking heads programme which is usually to be relied upon to provide reassuringly gung-ho and right-on pro-China commentary from Chinese and foreign guests alike, was just recently mentioning terms like "social unrest" and "rising crime" in relation to "mass unemployment".... in China. After 6 years of nothing but good news most of the time, these little unexpected doses of reality are quite a shock to the system.

10 million job losses this year in the construction sector alone, they were saying. And that's just what they're admitting to. Oh my gawd!

Economic indicators

Pundits are working overtime trying to find more novel, more telling pieces of evidence to help them predict how things are going to go for China in this meltdown year. Oddly enough, I don't think anyone has actually tried reading chicken entrails yet, but it can only be a matter of time.

I gather the People's Daily ran a story a little while ago suggesting that robust firework sales in the run-up to this Chinese New Year holiday were proof of continuing buoyancy in the Chinese economy (ha! more of the phoney optimism that is the country's principal manufacture at the moment!).

Even if this were true, I'm not sure that I would take much comfort from it. The Chinese fetish with fireworks is very much a whistling-in-the-dark superstition: the point of it is to invoke good luck for the year ahead by frightening away all the 'evil spirits' that might bring you the other kind of luck (evil spirits afraid of loud noises?? well, that's the theory). Even if folks are getting anxious about spending their money in such uncertain times, I'd still expect them to have a big blow-out on fireworks at this time of year..... maybe even bigger than when people are mostly feeling fairly confident and prosperous.

However, I don't think that has happened this year. Apart from the huge splurge on New Year's Eve, things before and after that have been mostly very quiet compared to the last few years. And a foreign journalist I spoke to the other day revealed that in a straw-poll he'd conducted of firework vendors around the city, everyone complained that sales were well down this year - some were saying by as much as 30% or 40%.

And this despite a major price war between the main distributors in Beijing this year.

Also, in the last couple of days, several large tents have appeared on street corners around the city selling fireworks for the last 4 days of the holiday over this weekend (the Lantern Festival, the official end of the main phase of New Year celebrations, is on Monday). I've never seen this before; and I think it suggests that the manufacturers have a lot of spare stock on their hands this year and are making a special push to try and get rid of it.

So - my view is that, up to now at least, firework activity has been significantly less this year than last. But is that a good sign or a bad sign?

I think.... if people don't even want to spend money to ward off ill fortune and try to improve their prospects for the year ahead..... then things are very, very bad indeed.

Another upsurge

After a couple of days of comparative lull in firework activity, yesterday things went crazy again. There was a fairly significant amount of rat-tat-tat-boom-crash from quite early in the morning, and after nightfall it soon became apocalyptic - possibly even more extreme than Sunday, in that it went on steadily for hours, rather than being concentrated in one great cathartic outpouring around midnight.

There were so many people letting off huge strings of firecrackers on the sides of the streets yesterday evening that the sidewalks were virtually impassable. Time and again you'd find your progress halted by another burst of explosions, and have to wait until your path ahead was "safe" again (some of these longer strings take upwards of a minute to do their thing). Impatience led me to take a few too many chances, scurrying past strings that were not quite finished. I got hit in the side of the head by a large, burning firecracker casing - that I thought for a moment had set fire to my hair. I wasn't being that reckless: I was passing by on the road, a good 7 or 8 ft away, and shielding my eyes. It's really not safe out there.

I gather Day 5 of the first lunar month is considered to be the birthday of Tsai Shin Yeh, the God of Wealth (that's a Cantonese spelling; I haven't been able to find out what they call him up here). Thus, the intensification of firework activity on this day is intended to honour the god and ensure his goodwill during the coming the year - perhaps particularly important in these days of meltdown!

Another sign?

It is strangely quiet today. It has been for the last several days.

Sure, there have been some outbreaks of firework mayhem - but they've been very muted, sporadic.

Ordinarily, firework activity gets under way a couple of weeks before the arrival of the Chinese New Year (tomorrow, Jan. 26th), and in the last few days it can be quite frenetic. I had thought that this year, since the holiday falls over a weekend (tonight is the BIG night!), things might start up even a bit earlier than that. But so far..... there's been almost nothing, compared to previous years I've been here.

Of course, it might be partly down to the weather. There's been a bitter cold snap this week, with a lacerating wind blowing in from the north-west at a steady 25 or 30 mph from late on Wednesday night to around midday on Saturday. Few people were willing to venture out in that, either to buy fireworks or to let them off.

However, I do suspect that this may be another indication of the meltdown making its effects felt here, dampening confidence, depressing consumer spending.

And then, maybe there's been something of a government crackdown on sales this year, because last year's firework blow-out was so over-the-top - and the behaviour of the populace so brainlessly self-endangering - that casualties numbered (according to one rumour I heard) in the thousands, in Beijing alone.

[And, of course, the conspiracy theory behind there being a firmer policing hand over firework sales this year is, you know, to do with mounting social unrest and the fact that these things are, er, explosives....]

I should enjoy it while I can. Undoubtedly, the city will be lit up like a battlezone tonight - however modest firework purchasing might have been compared to a year or two ago.

Update: Yep, come dusk - the whole place erupted. Probably not going to be getting much sleep for the next few days....

All I Want For Christmas (2)

OK, yesterday's suggestion was silly: what would I do with Viagra??

No, I'm a simple man. A nice big stack of money is what I'd really like for Christmas. And I have been very NICE this year, Santa, really.

Though, in current times, I suppose dollars are not really the thing. Could you make it krugerrands, Santa? Pretty please.

Signs & portents (The End of Days?)

People sometimes ask me, "So, how is the global meltdown affecting China?"

Well, it's difficult to say.

One of the first things I notice is that people seem to favour the 'tsunami' metaphor rather than 'meltdown'. Does that have any wider currency, or is it just a regional linguistic preference? A couple of the Chinese "academics" I edit for have used it already, and I noticed Hong Kong supremo Donald Tsang say it on TV the other day. I suppose, as a metaphor it has the advantage of suggesting transience - whereas a 'meltdown' can just go on and on (hmmm, perhaps not a good time to mention 'the China syndrome'?!), and even when it's over leaves an irremediable mess.

Then, the air has been uncannily clear over the past few months. I mean, even cleaner than it was during the Olympics. It started getting all crappy again pretty much the instant the Paralympics was done, but then it suddenly brightened up again at the beginning of October and we've been almost entirely smog-free ever since (we've had just a few bad days, but I'm sure it's been almost entirely domestic coal-burning and the occasional blitz of ancestor-worship bonfires, not industrial haze). Admittedly, the weather is usually pretty good through much of the autumn and early winter: it's an especially windy season, which helps; also, the government's statistics-wranglers are usually working desperately to hit their promised quota of 'blue sky days' for the year, and so ordering sporadic factory shutdowns to achieve that. However, we do also get a lot of really shitty air quality days through October to December every year, and this year there have been NONE. Chinese friends will insist that factory closures have thus far been limited to a few highly-publicised incidents in Guangdong, but..... I really think there isn't much manufacturing industry going on in the entire country at the moment.

There is a lot of forced jollity in the media about how pro-active the government is being in trying to stimulate the domestic economy (to bail out the rest of the world - thank you, China!). However, China Daily last week also mentioned a survey which suggested that the typical response of Chinese citizens - 3 out of every 4 respondents! - to the economic crisis was to "save more" (and, given the continuing crapness of China's banks - much improved since I've been here, but still pretty terrible - much of that saving is going to be, like my own, under the mattress). China is seeking to maintain its nominal GDP growth - and restrict unemployment - by pouring money into state-funded infrastructure projects. Stimulating domestic consumer-spending is a bit of a pipe-dream, I fear. And when you've become used to a decade or more of continuous double-digit growth, 7.5% counts as a recession.

The roads are oddly deserted. Really, the traffic is much better now than it was during the Olympics. OK, there has been a new restriction brought in to cut down car use (registration plates with a certain last digit are banned from operating on a particular day: I'm not sure if that works out to a 1-in-10 or a 1-in-5 reduction - though it seems to me like a pretty difficult system to publicise or enforce effectively); but during the Olympics, there were similar measures intended to cut down car use by half, and, in addition, most government-owned vehicles (nearly half of the total on the roads in the capital!) were pulled out of service, and a huge number of people quit town for a fortnight to avoid the whole circus. I would say that the number of cars on the roads now is significantly lower than it was during the Olympics, and down by maybe as much as 50% on what it was 6 months ago. Yes, maybe some people just learned to do without their cars during the period of Olympic restrictions - but I rather think that at least some of this lull on the roads is the result of reduced business activity (or of belt-tightening, loss of economic confidence, converting that second-car-for-the-Mrs into something-more-portable-like-gold). I am thus far something of a lone conspiracy theorist in making this observation, but I'm confident that in time more and more people will realise the truth of this. When the cars disappear from the roads in these sorts of numbers, it's a sign of something pretty dramatic - and not good.

Oh yes, and this may not be so much of a 'meltdown' thing as a 'China's economic miracle is built on straw' thing, but..... a couple of weeks ago I learned that almost all of China's domestic airlines have been losing money hand over fist for the past year or more. This being China, their response has been to start omitting to pay their landing fees to the airports. Since the state has to prop up this industry (and is probably still the major investor even in nominally privatised airlines), we can be sure that there will be some kind of surreptitious bail-out. But we had reached the awkward, ugly, risible stage of having the chairman of the Airports Association going on TV to threaten the airlines with being refused landing rights if they didn't make good on their arrears. What larks.

Ah, and then I mentioned the other week the curious phenomenon of how massive road and sidewalk mending operations around the city of Beijing appeared to have been abandoned half-finished for two months. Something odd going on with that too......

My basic Jeremiah message (or perhaps Cassandra?) for you is this: if you're waiting for China to dig the rest of the world out of a hole, think again. China is built over a hole of its own, and this global crisis might just cause it to topple in. Interesting times.....

Impassable

I have commented before on the frequency (and protractedness) of sidewalk renovations in this city - but just lately, things have been getting ridiculous.

The sidewalks on both sides of Jiugulou Dajie, the main southbound street near my apartment (which I walk along nearly every day), have been completely impassable for a couple of months: although much wider than in most parts of town, these would-be pedestrian thoroughfares are riddled with holes and trenches, piles of sand and stacks of paving slabs every few yards. It's particularly difficult to traverse these obstacles at night, since street lights are few and far between, of rather low brightness (the government no doubt claim this as a sign of their Green consciousness, but it's probably more to do with the shortfall in generating capacity), and largely obscured by the ubiquitous bloody trees anyway. Lately, I have fallen into the habit of cutting through the hutong back-alleys when I go out at night - because it really is just too darned hazardous to try to negotiate these sidewalks in this half-dug up condition (and there are no warning signs or tape cordons, of course!).

And it was not just this street. Almost all the major streets in the centre of the city seem to have been reduced to this condition. The shots above were in fact taken a couple of weeks ago on Zhang Zizhonglu - one of the city's main east-west thoroughfares!

We always get big seasonal splurges of this kind of repair work, but this year it seems to have been more thoroughgoing, more widespread than ever before. And it started in September, within days of the Paralympics concluding. I wonder if perhaps the deterioration of the sidewalks (another trees problem - the shallow root systems often chew up the paving within the space of 6 months or so, requiring continual re-levelling) has been more chronic this year because the spring/early summer repairs were done earlier than usual (and perhaps in a more rushed, slipshod manner - if such a thing is possible!) because of the panic about prettying the city up in time for the Olympics. It seems quite likely.

The most alarming thing about this phenomenon is not the inconvenience and health & safety risk it constitutes, nor its startling ubiquity - but the fact that it has gone on such a long time. The work was begun in late September or early October, but proceeded very slowly - and then seemed to be abandoned altogether for several weeks. I began to worry that it might be another indication of the impact of the 'global meltdown': if the Chinese government is running out of money to complete routine public works...... then we are all in big trouble.

PS Just in the last couple of weeks, the sidewalk re-laying finally seems to have been completed. The workforce was diverted elsewhere for a month or two, I suppose. Perhaps the 'global meltdown' effect here is that China is channelling its spend-it's-way-out-of-recession efforts into more conspicuous public projects like new roads and bridges and subways, and mundane pothole-filling is occasionally getting sidelined.

The 'meltdown' - in a nutshell

My journalist friend Martin (better known to readers of Barstool Blues as my pool nemesis, New Dad) very kindly sent me a slew of links to primer articles on the financial crisis earlier this week, to help me with the rather odd writing assignment I had taken on - to explain the issue in language a 15-year-old Chinese schoolchild might understand.

The best by far was this, a cartoon slideshow that will explain to you exactly what went wrong in about 2 minutes. Unmissable.

The things I get asked to do

The other day I received a request to produce (at 24 hours' notice - ah, China!) an article on the global financial meltdown...... for Chinese middle school students!

At least they were asking me to write in English. That made it so much easier.