Monday, March 9, 2009

China- The New Super-Power as India Degrades!

It seems like everything is turning upside down. America was considered the center point of the economic universe. They could save anything... anybody... any country. But not any longer. The U.S. is in the middle of one of the worst recessions ever experienced. Meanwhile, on the other side of the world, China's economy seems to be heading in the right direction. Since November, the Shanghai Index has outperformed the S&P by 75%. And China's banks are more solid than those in the U.S. They weren’t loaded with sub-prime toxic loans.

You could even say China is the U.S.'s biggest banker. That's because China has been buying up U.S. dollars. In fact, it now owns nearly $1 out of every $10 in U.S. public debt. China maintains the world's largest cash reserves of roughly $1.9 trillion. And you know what they're doing with some of that money? They're buying up oil assets at pennies on the dollar.

Needless to say, the speculators once said that China would be the first country to get hit as mostly every single penny Chinese earn is derived from USA. But China has emerged stronger than USA and is ruling the Economic markets all-round the world.

Coming on to India, India will be the next big thing, but at this moment all the strength which was commanded by Indians has been thrashed due to their over-dependence on Exchanges around the world, leading to devaluation of their assets in a sharp free-fall.

India was the most isolated country as far as Sub Prime market was concerned but had its major Forex shares derived from US Majors which have either declared Chapter 9 Bankruptcy or have been bailed-out, hitting Indian Economic Market hardly and ruining the Standard currency.

5 comments:

Shaurya Srivastava said...

Nicely explained about China and their domination in the world market.....Thanks to the link given by you about 'Subprime Mortgage Crisis'.....I am understanding what you are trying to say.....Simply written and well executed for people like me to understand......Now I am able to get the feel of World Market by your informative posts with nice views on them.....Thanks a lot!!! This is the best post I have read from you.....Hope to get even better than this in simple language as this one is.....Nice Work!!!

Ankit Poddar said...

vinit,

brilliant! written in the simplest of words, the post comes across as very witty, which is a step up for any blogger!

as regards, China as a world power, it is impossible for it to sustain that position, even if it reaches there, for a nation that suppresses the rights of its own citizens and showing utter disrespect for human well being indexes, can not sustain progress!

D said...

Ankit,

I truly agree with your view, but at this point people dont have money to invest and in such cases a country like China develops as all development is in hands of Government and they are funding their own people enormously, which is not the case with India.

Divine Interception said...

Ankit,

I truly agree with your view, but at this point people dont have money to invest and in such cases a country like China develops as all development is in hands of Government and they are funding their own people enormously, which is not the case with India.

Vyom said...

vinit
nice work... keep it up