Monday, January 25, 2016

China 2027: Empire of the Future or Sh@t Kingdom? Future Predictions

Can China's consumers save the world economy?

Many investors are betting on it!  After all, China has 1.375 BILLION people, and is the second largest economy in the world.  The United States is the world’s largest economy with just 320 million voracious consumers. Just imagine how big and lucrative the Chinese economy could become if its population behaved like their Western counterparts?!

But there's just one problem: “You can lead a horse to water, but you can’t make him drink.”

The the age of Chinese ultra-consumerism is not to be!

Sure, companies like Alibaba are enjoying rapid growth thanks to a sizable Chinese 'middle class', but the truth is, most Chinese are very poor (the average income of the Chinese worker is just $14,600--far below the U.S. poverty level), and this won't change much (if at all) from 2016 forward.

Why?

Communism and Consumerism just don't work together.  Communism breeds group think which, in theory, is appealing to marketers who rely on such thinking, but it lacks the 'keeping up with the Joneses' style competitive mindset that is required to lure the masses in to buying the brands that Westerners crave in order to feel good about themselves.  To put it simply, the Chinese just don't care about such things, especially in the face of poverty, lack of freedom, and epic levels of pollution!

What's worse, the Chinese economy completely relies on the West, and in particular,  the United States.  When the U.S. falls apart following the 2018 disaster, so goes Communist China.

Communist China's days are numbered.

If you paid attention to the recent protests in Hong Kong, you may have noticed that the desire for democracy is boiling over in to mainland China.  Prior to its merger with mainland China, Hong Kong was a mecca of free market opportunity.  It was no coincidence that when Hong Kong merged with mainland China in 1997, China's economy exploded!  But, now that China's Communist government is clamping down on Hong Kong's freedoms, it should be no surprise that China's economy is flailing.

Despite attempts to crack down on calls for freedom, it has already spilled over in to mainland China, and by 2020, the government will have its hands full trying to contain it!  And, what a waste of energy, too!  Such efforts will only push China into a rapid decline that will only end by 2027, when democracy takes over, and the country is split in to smaller regions of control, established outside of the Beijing and Shanghai.

A catalyst to all of this is the surviving Texas/Southern California (Texifornia) nation state will do its best to lift China out of its ‘funk.’ Texifornia, with its good old fashioned American values will play a heavy influence on the emergence of a New China.  More details to come...