Good news: the U.S. has quietly broken a decades-long retreat from economic freedom, becoming a place more supportive of private business and the ability of individuals to make a living. This news comes courtesy of the latest report on the ” Economic Freedom of the World ,” published last week by Canada’s Fraser Institute and the Cato Institute and using data up through 2016. “The foundations of economic freedom are personal choice, voluntary exchange, and open markets,” write authors James Gwartney, Robert Lawson, Joshua Hall, and Ryan Murphy—though there’s rather a lot more behind the numbers, as you might expect.
China’s Shadow-banking system is collapsing (and with its China’s economic-fuel – the credit impulse), it’s equity market has become a slow-motion train-wreck, its economic data has been serially disappointing for two years, and its bond market is starting to show signs of serious systemic risk as corporate defaults in 2018 hit a record high.
Make no mistake, this “loan” is not being made to assist Venezuela. It is with the intent to economically enslave the country so China can exert control over it. The US is guilty of doing this as well, but it should be alarming this is happening from China in the Americas.
For a brief period earlier this year, it appeared that Beijing had finally had enough of supporting its “ideological allies” in Caracas when it decided to limit its “exposure” to Venezuela after the country struggled to make interest payments on a $19 billion loan.
President Donald Trump planned to borrow heavily to finance his long-awaited infrastructure plan. “Donald Trump wants to rebuild America’s infrastructure the same way he built his buildings: debt, debt and more debt,” Jonathan Swan writes at Axios .
The “dream” of socialism has once again collided with the realities of economics, after nearly 40% of stores in Venezuela have been forced to close following a mandated 3,000% increase in minimum wages by the Maduro government, according to the Miami Herald , citing the National Council of Commerce and Services of Venezuela.
I think it’s a questions worth asking and trying to answer – what happens to the world economic system if China crashes?
Recently we discussed how in addition to the widely manipulated Chinese GDP data, new concerns had emerged about official data involving Chinese industrial profits, because while China’s National Bureau of Statistics has traditionally reported positive year-on-year growth rates in percentage terms, growth in absolute yuan terms has been negative .
Bob Murphy recently pointed to a misleading remark in a recent column by Paul Krugman . I’d like to point to another: But what can be done about it? Corey Robin says “socialism” – but as far as I can tell he really means social democracy: Denmark , not Venezuela.