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China announces $586-billion stimulus plan

HEATHER SCOFFIELD

Globe and Mail Update

Latest comment posted at 4:46 AM EST 10/11/08

Cabinet adopts massive spending package and shift in monetary policy to stop global financial crisis from hitting world's fourth-largest economy ...Read the full article

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  1. Roop Misir from Toronto, Canada writes: I guess money talks!
  2. J A from Ottawa, Canada writes: Don't hold your breath - see how much of this money will be siphoned off to the pockets of layers of communist officials before it reaches the people.
  3. JD Wood from Toronto, Canada writes: It would be nice to see Stephen Harper come up with such an intelligent plan. Our economy is shifting over to green carbon-based products and with Obama in office, we certainly need our own economy boost.
  4. Randal Oulton from Toronto, Canada writes: >> JD Wood from Toronto, Canada writes: Our economy is shifting over to green carbon-based products...

    Nice as that would be, I think that statement is more a 'wish' than 'weality.'
  5. Allan Franklin from Toronto, Canada writes: Expect the quality and safety of Chinese products to deteriorate even further as they try to maintain high revenue growth and profitability.
  6. kevin o'connor from Canada writes: We also need a stimulus plan. We are in a relatively good position compared to others due to our well regulated banks, solid federal fiscal postion and natural resource wealth, but we have to face it, we are a medium sized economy that is integrated into the global one, and most of it is going down.

    China and the USA are going to have stimulus packages. We need one too. Now. Here's what i think we should do:

    1) Raise the amount individuals begin to pay income taxes to $20 or 25,000; a major stimulus in the short term.
    2) Major public works initiatives in infrastructure, health care and renewable energy; a stimulus for the medium and long term.

    Yes this means a deficit but that is the lesser evil at this point. We are on the precipice of a major slowdown. We are are going to be pushed over. It's not time to deny it's happening, but time to ensure we have the softest landing possible.
  7. gilly maxima from sudbury, Canada writes: Allan Franklin writes: Expect the quality and safety of Chinese products to deteriorate even further.

    Is that possible?
  8. Lester M from St. Catharines, Canada writes: The Harper government introduced a stimulus program more than a year ago - highly criticized by this same Paul Martin as being irresponsible...the same Liberal two-faced approach - criticize the Conservatives for prudent action, and then suggest the same recipe as their own solution to the problem.

    I think the govt should continue its approach of targetted support for the banking system and the credit markets and a prudent approach to spending - let's face it, not all government spending is equally efficient - a portrait museum, after all, is not likely to be a major economic stimulus - maintain the direct tax credit programs that put money into consumers hands and not over-react until we have a better understanding on how the economic meltdown will affect Canada and what prescriptions are likely to have the most benefit.

    And, Mr. Martin - go home - your glory days are past, so give it up.
  9. Alan Pater from Vancouver, Canada writes: What are the changes to monetary policy? Will they be putting in rules to prevent asset bubbles? Will they be letting their banks go bankrupt? What are the policy changes?
  10. Lester M from Canada writes: Oops - posted this to the wrong column - sorry about being off-topic....
  11. robert quinn from Japan writes: Hey, Randal, that was going to be my funny! Thief.

    Seriously, 'green carbon-based products' means what, exactly? Nor does the post read like a genuine JD Wood comment. It lacks that special 'Vern' flavour: There's passionate lunacy but no insensible ranting. I smell a rat. (Dated expression, I know. I've never smelled a rat. For all I know, their aroma at rest resembles lilacs at full bloom.)
  12. X Y from National, Canada writes: Harper can't do anything because he gave away the cushion so I could get two cents off my cup of Timmy's every morning.

    Every economist has panned this bad policy-making (except Harper). Now they realize that the cushion provided by a consumption tax is good and would have helped Canada get through these times.

    Now we can expect a deficit (not a bad thing at low interest rates) that could have been avoided.

    Did we all really think cutting the GST was wise?

    I guess it was only a little less wise than Dion's carbon-tax, judging by who formed government.
  13. Neandercon The Barbarian from Canada writes: Good to see China include itself in the global village. everyone is in this together, the only way to fix the economy is with all parties concerned co-operating.
  14. D. Hall from Canada writes: Wise words from Martin on emerging economies and international financial bodies. The world has changed and the old guard saying 'things are too tough to let you new players have a say right now' is foolish.

    Players like China will have their say based on their economic clout.

    The choices are welcoming them quickly and working out a good format for their input, or stalling and putting them off until they ram their input down our throats with the force of their trillions of dollars. Which sounds more sensible?

    Martin for Finance Minister!
  15. Double Money from Canada writes: Good that their is dialogue among the G20. Good to see that China is showing some leadership on the world stage.

    www.doubleourmoney.ca
  16. Vic Hotte from Canada writes: Too much credit, debt and low interest rates got the world into this financial mess. Now, the G-20 wants the Asian and other emerging economies to spend their savings, and China is obliging. So, the governments of the western world have bailed out mismanaged financial institutions and are now teetering on the brink themselves. China is being lauded for kick-starting the same process all over again. If a tidal wave of debt and easy credit goes round the world once, is it even better the second time round? We need to learn to live within our means, not run the government printing presses to create inflation based on artificial growth. Economics never seems to advance beyond its basic theories, and it keeps making the same mistakes over and over. Like religion, it never wants to rethink and modernize. It's easier to stick to the same old dictums that never really consider the changing world 'outside'.
  17. Anne Peterson from Canada writes: What we really need is Dion's Green Shift. Germany has burned ahead in green technology as have the social democracies of Norther Europe. We are stuck in the past. I wanted Dion's loan and grant to try to put geothermal heating in my house. Those who love the oil patch don't want Canadians to do that. And I am NOT Liberal and I AM an Albertan.
  18. Springfire . from China writes: This is just step to prevent the world economy sliping further down the hill, i.e. a short-term measure. Inevitably, new world economic order needs to be established so that we don't have to go down the same path again.
  19. J Kooman from Canada writes:

    USA (and to a lesser degree Canada) is deep in debt and we need to borrow more. Are we in a position to dictate the terms? Our finance minister appears to live in the Fantasy Land.

    China is showing leadership to save us from this global recession. It is a good starting point. We shall see India, Russia to chip in. Do NOT react with a hostile attitude, but we need to have an open mind, sit down to negotiate with the developing countries - especailly the BRIC. We can no longer pretend to be the Dominator.

    On the pessimist side, we don't want a deal including EU and the developong countries only, and leaving out USA and Canada.

    (I don't trust Japan. It may abandon us in the last minute and cross the fence. Didn't it?)
    ...
  20. Hendrick Larose from Canada writes: Good news on two fronts. One China is a major economic force and the strength of their economy helps North America's. Secondly they can afford to spend billions as they have amassed surpluses over the last few years. Hopefully this will offset the overdone negativism that the media has been spewing.
  21. Another Canuck from Canada writes: Alan Greenspan and President Bush must feel proud of their shortsightedness. Greenspan actually thought that American banks had the interest of its people. He failed to factor in Greed into the economic equation. So now countries are spending billions to bail out the fat cat greedy bankers while millions starve.. Nice legacy for Bush and Greenspan......
  22. Hendrick Larose from Canada writes: X Y from National, Canada writes: Harper can't do anything because he gave away the cushion so I could get two cents off my cup of Timmy's every morning.

    Every economist has panned this bad policy-making (except Harper). Now they realize that the cushion provided by a consumption tax is good and would have helped Canada get through these times.
    ============================================
    This was the platform Harper ran on a couple of years ago and Canadians elected him PM on that platform. He kept his promise. If it was a policy mistake, her got help from Canadians in deciding it was the right thing to do.
  23. Dr Demento from Canada writes: J A from Ottawa, Canada writes: "Don't hold your breath - see how much of this money will be siphoned off to the pockets of layers of communist officials before it reaches the people."

    I suspect that far less will be siphoned off by communist officials in China than was siphoned off by wall street bankers and their political cronies in the USA . . .
  24. A Canadian from Cole Harbour, Canada writes: JD Wood from Toronto, Canada writes: It would be nice to see Stephen Harper come up with such an intelligent plan.

    --

    Yes JD and if he did make an announcement about spending this much money, you and the rest of the wingnuts would be posting other negative messages.
  25. Jah Nee Kah Sun from Canada writes: It's the end for unbridled, unrestrained Capitalism...finally. Canada should be thinking of nationalizing Key Industries and Strategic Resources, as well as claiming sovereignty to the North, in particular, the North West passage.
  26. Linda Dial from Canada writes: Informative article, and not surprising the neo-con leaders of USA, Canada and Japan are in disagreement with Europe and the emerging markets. Let's see how fast the Conservative propaganda machine turns to sputtering bluster to "react" to this and dominate the news cycle. LOL. At least we now know that Paul Martin is following what is going on closely. Watch the world go greenshift.
  27. bilbo baggins from Canada writes: This is too little, too late. China is already in the recession. Why? Because the world's customer, the US, is in one.

    Springfire - nice dream but first China needs to get a billion of it's people off dirt floors first before it can claim to restructure the world economic order. Removing lead paint and melamine (and god knows what else) out of the production process would be a good step. But as all the experts to China want to tell us, everything moves slowly. Oh well.
  28. Just In from Canada writes: Last I heard, Paul Martin as Finance Minister was more respected in Canada and worldwide than Jim Flaherty with his usual denial and inaction hoping the problem goes away magically.
  29. Yvonne Wackernagel from Woodville, Canada writes: Stephen Harper, wake up! You are going to allow Canada to go down the drain, after you have spent the $13 billion surplus, the $3 billion contingency fund and after just two and half years, BEFORE THE CRISIS HITS CANADA, you are already in deficit. Paul Martin left us with a GOOD NAME ON THE INTERNATIONAL FRONT, well respected by the balance of the world for his innovation with respect to the G20, etc. And now you want to go with the losers. Read "Blood in the Streets" by Lord Rees-Mogg and Senator James Dale Davidson, written nearly 20 years ago (they predicted the failure of the Savings & Loan) where they have predicted that the depression will start in Japan! It is time we start thinking outside the United States and it is time -according to the World Trade Organisation that we take action with respect to the emerging markets, Brazil, India, China, etc. NOW.

    The rural areas of Ontario who are responsible for putting in this Conservative will be the first to suffer and it will serve them right! Just let us see how you get around without any bus service!
  30. Ed Moore from Vancouver, Canada writes: There is no better way to get the emerging markets to work cooperatively with existing international structures than to give them a voice. Keep them out, as the US, Canada and Japan are trying, and they'll go their own way. This is not a desirable outcome.
  31. Dice Li from Ottawa, Canada writes: Hopefully they get their focking head right. More hospitals and universities, less stadiums and crap shoot "parks" with 10 freaking trees and gigantic parkinglot...
  32. The Economic Hitman jr. from Vancouver, Canada writes: We need Mr. Martin back in politics
  33. scott thomas from Canada writes: I really can't believe how out of his depth Flaherty is.
  34. Chris E. from Canada writes: There will be further initiativese to export surplus young Chinese of working age to Western countries.

    It bleeds off the pressure in China for scarce opportunities, it brings hard currency back to the motherland as expatriates send remittances back to China, it places a sympathetic migrant community overseas who can influence pro-China foreign policies, and it facilitates the harvesting of Western technology for copying in China, saving billions in research and development costs.
  35. Kothar Rumbleg from Canada writes: The Baltic Shipping index is going to skyrocket, commodities are saved, oil will go up once again! Ha, or maybe not.
  36. Just In from Canada writes: Flaherty has a small mind and a big mouth.
  37. Sebastian Flyte from Canada writes: (eyes crossed) Hey????!!!???? (red neck bulging) WTF?????

    That's communism!!!! Duh, I mean, socialism!!! ...whatever...
  38. PC Montreal from Canada writes: Allan Franklin, my sentiments exactly. Also, for those of you that think the sales tax cut removed a cushion, while that's true to some extent, let's not forget thet the first GST cut was actually financed by an increase in income taxes.
  39. Sebastian Flyte from Canada writes: China, running a huge surplus, spends $586 billion on infrastructure and social programs.

    The US, running a gargantuan deficit, spends $2.4 trillion in Iraq and Afghanistan doing the complete opposite.

    Of the above two, who should we be emulating?
  40. Michael Richardson from OakvilleMontreal, Canada writes: Flaherty has got to be one of the worst finance ministers in our history. Not only is he destroying years of good international work on behalf of Martin, he's again siding with the outgoing Bush administration in an isolationist move to exclude the major economic powers of the future. They will take note of this position and it will not be forgotten when the time comes to beg for our position at their tables. I've lived in some of these countries, and up until now they have had a very good view of Canada, which has afforded us the opportunity to do business, relatively unobstructed. Thanks to the cold conservative stance on global cooperation and their short-sighted views on China, and now on the rest of the BRIC and emerging markets, we are sure to find ourselves once again in a hole, which no doubt future generations of Canadians will have to wrestle their way out of. Money talks is right, and Flaherty's B.S. can walk. When has this government done anything right. A GST cut is the stimulus package you get? Really, a GST cut just gives poeple more reason to go out and spend what little money they have!!
  41. tulip7 R from Canada writes: Good to see this.

    Action speaks louder than words.
  42. Comments closed, censored, deleted or made to disappear from Mini Bushland, Canada writes: The mighty dragon keeping on rising.... --- Little Canada should beware and continue to keep away from it, I presume?... Poor little thing! Poor eternal minority lot!!
  43. Ed Long from Canada writes: A globally responsible action by China.

    Now we see the problems with doctrinaire conservative Western governments who cannot accept they no longer control the boat and coordinated international action is required now.

    Canada is again, under Harper's shortsightedness, following the U.S.'s self-destructive and protectionist actions which has no benefit for Canada other than moving quickly to become an U.S. economic protectorate.

    Good bye Canadian independence and global influence.

    Paul Martin and Ralph Goodale were the most responsible finance ministers of this country in this generation.
  44. Stan Consultant from Canada writes: This is the first time I've seen a bad report by Scoffield. Maybe she's a little overwhelmed reporting from a foreign country. The report reads little an opinion column written by Paul Martin. Scoffield doesn't quote a single other person. For all we know, she didn't speak to any other person. This is really bad reporting.
    I've also never seen the power of the wealthy so explicitly bared, fang and claw. Stimulus packages and rewarding the criminal investors who got us into this mess are the exact opposite of what governments should be doing. The idea that the solution to fraudulent debt is more debt for innocent people as well is a theory only wealthy criminals could come up with. All the facades and veneers have been striped away, and the rich are openly driving governments with whips, to obey and serve only them. I really can't imagine any good reason why the ordinary people of China should pay the fraudulent mortgages of Americans, simply to save the income level of investors in fraudulent mortgages.
  45. Gerry Vee from Canada writes: It's disturbing to see how many people blame the cut in gst for current financial woes. The taxation system is not great but is not the culprit in this case. It is the monetary system and the banking system that needs to be fixed. Injecting more cash will only perpetuate the problem and the problem is that our economies are based on credit and greed. It's time our society learned to live within it's means.
  46. Just In from Canada writes: Michael Richardson from OakvilleMontreal, Canada,

    but Canada under Harper/Flaherty signed a free trade agreement with Colombia. They must know where the opportunity is.
  47. Rae Ellingham from Roberts Creek, B.C., Canada writes: Well, my cat says, if it means China can finally make a can opener that does not disintegrate after the first couple of turns, he's all for it.
  48. Michael Richardson from Montreal, Canada writes: Just In, good point. Hopefully they won't screw that up too!
  49. Just In from Canada writes: Gerry Vee from Canada,

    Cutting the GST didn't create the credit crisis. It merely revealed a Harper/Flaherty mind set that good times last forever and they removed the cushion that we could use now for a stimulus. Better yet, that money could have been used for developing new industries (R&D incentives, trade efforts) to prepare for lean times to compensate for the downward trend of old industries - this may be asking too much of the duo with small minds and big mouths.
  50. tulip7 R from Canada writes: Save world is to save China.
  51. James P from Spruce Grove, Canada writes: Make sure Qb has enough cash..That is what is really important!
  52. Richard Roma from Canada writes: This financial commitment sounds like a half-hearted attempt at
    reviving their economy. It's too little too late. It did wonders
    for the US.
  53. Just In from Canada writes: Ed Long from Canada writes: A globally responsible action by China.

    Now we see the problems with doctrinaire conservative Western governments who cannot accept they no longer control the boat and coordinated international action is required now.

    Canada is again, under Harper's shortsightedness, following the U.S.'s self-destructive and protectionist actions which has no benefit for Canada other than moving quickly to become an U.S. economic protectorate.

    Good bye Canadian independence and global influence.

    Paul Martin and Ralph Goodale were the most responsible finance ministers of this country in this generation.

    ------------------------------------------

    It will be interesting to watch how the market reacts to a belligerent trio of Canada, Japan and (may be) U.S. at a time when the world needs confidence.
  54. The Bubble from Canada writes: Didn't McGuinty just come back from there?
  55. J M from Calgaristan, Canada writes: If Chretien and Martin still ran the country, we'd have the best performing economy in the world. Think about it. Times we're good, surplusses we're HUGE and the economy was flying. Now we have the neocons siphoning off money for their friends (Big Oil for instance) and a disaster of an economy. At least the Americans had the sense to elect Obama and work for a successful future. We're screwed.
  56. Dice Li from Ottawa, Canada writes: Chris E, I've never thought of it that way, since most of the immigrants I met either came here on their own terms (for reasons such as less competition for their kids' schooling) or came here as "refugees" (for all the outrageous excuses canadian government are letting them to pose), really no one was sent here by the chinese government, nor is that lameass government has any PR brain to be able to be smart enough to dream up such thing. But, you work on that, I'll try to take ur proposal and sell it to the chinese embassy see if they'll eventually implement what you've been trying to teach them to do :D
  57. Vote NDP in the next federal/ provincial election. from Toronto, Canada writes: China can make good use of its $586 billion by:
    -buying more Canadian made produces
    -start cleaning up its air(worst pollution in the world), water, and land
    -start building more clean, renewable energy
    -get millions out of poverty in China,
    -give decent health to millions in China.
    -dedicate 0.7% of GDP to foreign aid
  58. J S from Canada writes: "J A from Ottawa, Canada writes: Don't hold your breath - see how much of this money will be siphoned off to the pockets of layers of communist officials before it reaches the people."

    Change a couple of words and you could say this about all of the bail-outs. In the United States, change "layers of communist officials" to "greedy CEOs and executives" and it works...

    I'm surprised that a communist country is the last to implement an incredibly socialist bail-out. Communist China was doing better at 'free markets' than capitalist USA...
  59. Toxic Planet from Disney Land USA, Canada writes: China.... good capitalists, USA.... bad capitalists.

    Score: China 1 USA zero
  60. martha stewart from Canada writes: J M from Calgaristan writes: "If Chretien and Martin still ran the country, we'd have the best performing economy in the world. Think about it. Times we're good, surplusses we're HUGE and the economy was flying."

    That was then, this is now. It does not matter who is in power in Canada. This is a global problem. Unless you think any Canadian politician can control the price of commodities, or cause everyone to buy new cars, or...

    And it wouldn't have mattered who was in power back when "Times were good" either.

    Sometimes partisan thinking is revealed for the stupid blinkered box that it is. This is one of those times.

    P.S. Paul Martin pops up. Hope nobody follows his lead and builds a federal surplus at the expense of the provinces. And since Canada really needs the tax revenue, hope corporations don't follow his lead and register their companies outside of Canada.
  61. J Ecoff from Canada writes: Just a minute! Where are they going to get the money? Oh they have to use the devalued foreign reserve specially those in US bonds or are they going to print money as any other country? Just curious.
  62. Fred Draper from Kingston, Canada writes: Just In from Canada writes: Last I heard, Paul Martin as Finance Minister was more respected in Canada and worldwide than Jim Flaherty with his usual denial and inaction hoping the problem goes away magically.
    _____________________________________________________

    No, it was the other way around. Flaherty's more respected.
  63. Scott Luft from Coldwater, Canada writes: China takes action and the article quotes Paul Martin. I realize it is the weekend but there must be a reporter working somewhere.
    The GST comments are getting pretty old ... as are the celebrations of the excellent clerk, Mr. Martin.
    Here are some points to for people who have been bleating about this for the last couple of years:
    Conservative introduced the GST to replace other taxes, but set the rate a couple of percent higher than necessary to tackle the debt.
    Mr. Martin responsibly didn't screw that up.
    Opposition leader Harper constantly questioned the liberals competence in budgetting ... meaning lowballing spending to recover extra money.
    You can take exception to the GST cut regardless.
    But, note our neighbour to the south has already given half a trillion dollars away hoping people will spend it, and you are commenting on an article about China doing the same.
    Citing this as evidence of the stupidity of a cut in a consumption tax, following which Canada's consumer spending is holding up far better than comparable nations, is not intelligent. Regardless of how many economists you say agree with you.
  64. Bryce Richards from Calgary, Canada writes: All these countries can do now is print ever larger quantities of fake money to prop up their economies. Remember when a billion used to be a lot of money. Soon it will take $586 TRILLION dollars to bail things out.

    A financial meltdown is inevitable but these capitalist economies just don't get it. No individual including a country can borrow forever without the consequences. Borrowing ever larger sums of credit only postpones the final day of reckoning.

    All the worlds credit cards are maxed out. Valuations of both assets and liabilities are becoming meaningless.
  65. Stan Consultant from Canada writes: To all those who keep complaining about shipping registered in other countries -- Would you please* take half an hour to research international trans-ocean shipping, to understand how and *why* ship owners in Canada and the US register their ships under foreign flags, *before you start knee-jerking all over the forum like malfunctioning machines with defective computer chips? Thank you very much.
  66. E B from Canada writes: There aren't enough trees in the world to print all this worthless paper money. Let's not forget that it was the Chinese who started this fraud close to a thousand years ago.....
  67. Just In from Canada writes: Fred Draper from Kingston, Canada writes: Just In from Canada writes: Last I heard, Paul Martin as Finance Minister was more respected in Canada and worldwide than Jim Flaherty with his usual denial and inaction hoping the problem goes away magically.
    _____________________________________________________

    No, it was the other way around. Flaherty's more respected.

    -------------------------------------------------

    You mean idolized, by those who believe in complete hands free de-regulation or self-regulation, those of his clan looking for a bail out from the "enlarged government" that they so "despised", and those who believe in condoning mediocrity with names like Rona Ambrose, Maxime Bernier, Helena Gueris, Gary Lunn, Gordon O'Connor, and Gerry Ritz - all except Bernier still in cabinet.
  68. Stude Ham from Outremont, Canada writes: to date the so-called 'stimulus' packages of the likes of gwb and the harper have had about as much effect on the crumbling economies of their respective countries as the famed horse pills in marx brother movies. most of the monies thrown away by these leaders has fundamentally vanished in great big plain brown packages and envelopes. the chinese are not going to do any better. the idea that the economic crises now being faced by the world is entirely about money is a bit absurd... especially when the inexplicable sudden rise in oil prices, crushing everything in its paths, is also factored into the picture. right now it definitely may be said that not a single country, nor a single leader, has any idea whatever on how to grapple with the world wide disaster. harper gave the impression that he had solutions to the problem and made this grand vote grabbing gesture of donating to the banks some 30B$ of taxpayer moneys... as if that would begin to heal some kind of financial cancer. and as events have proved... things have gotten much worse and harper has no clue whatever on how to go about managing the economics presently facing canada. harper's biggest mistake, outside of the 30B$ gift to the banks, was allowing flaherty to retain the finance ministry posting... and bringing into this toxic brew, more of the mike harris 'common sense revolutionaries' who actually helped to wreck ontario. *DUMP HARPER! *
  69. Jason Marcotte from Thunder Bay, writes: Paul Martin was the best finance minister Canada has had in the past 40 years. Canada is far better off today because of him, and the world should be welcoming any contribution he can make to stabalizing the global economy.
  70. Pacific Volcano from Ottawa, Canada writes: Spending in these three areas are needed the most in China.
    - Social program
    - environment.
    - infrastructure,

    good to see it is spending money wisely in the right direction.
  71. Kothar Rumbleg from Canada writes: Surpluses = overtaxation
  72. Just In from Canada writes: Kothar Rumbleg from Canada writes: Surpluses = overtaxation

    -----------------------------------------

    and Dogma = Ideocy
  73. Allen M. from North York, Canada writes: It will produce a too distant impact to Canadian economy in uncertain future.
  74. martha stewart from Canada writes: J Ecoff writes: "Just a minute! Where are they going to get the money? Oh they have to use the devalued foreign reserve specially those in US bonds or are they going to print money as any other country? Just curious."

    They have about 1.5 trillion in US dollars in reserves, built up with all those trade surpluses they have been running. The value of the US dollar has increased relative to most other currencies of late.

    Allen M. from North York writes: "It will produce a too distant impact to Canadian economy in uncertain future."

    The whole recent commodities boom was largely based on China. If they can get their economy moving better this will definitely help Canada. Won't return us to the giddy boom times but it should help.

  75. Woody Forrest from Out in the Sticks, Canada writes: E B from Canada writes: "There aren't enough trees in the world to print all this worthless paper money. Let's not forget that it was the Chinese who started this fraud close to a thousand years ago..... "

    Funny you should mention this E B. China's largest paper bill is the 100 yuan bank note. This is now worth roughly $17 Cdn. It would take a lot of trees (rice?) to pay cash for a big ticket item over there.

    This should also give us an idea of what things cost the average person in China, and possibly how much disposable income they have.

    Considering the number of people in China and the low value of its largest paper currency, there has to be an astounding amount of paper being circulated over there. This from a country that uses concrete to build just about everything because they don't have enough wood.
  76. Cosmo Spacely from Canada writes: I wonder if the food that the two people are enjoying in the photo which accompanies this story is contaminated with melamine?
  77. J Kooman from Canada writes:

    I guess the Chinese is getting smart. Instead of lending out their money and spending their reserve on US treasury bills, they will spend the 500 billion on the welfare of its people in highways, roads, railway system, irrigation and drainage, hospitals, low emission power plants, ... They will get good value for their money when everywhere else is downsizing.

    This is also very good news for Canada. There are more than a few things Bombardier, SNC-Lavalin, Suncor, ... are more than willing to sell to China - and they can afford to pay for their bills.

    Good luck for those waiting for US stimulus package. In that case maybe we should expect President Obama:
    to print some more US notes to cover the cost,
    or ask Canadians to buy more US treasury bills.

    ...
  78. Vern Johnson from Prince George, Canada writes: Yes, Martin is right. But, so is Jah Nee Kah Sun. Emerging markets must be included in any effort to stabilize and regulate the global economic system based on the US dollar. But it is obvious that the US dollar must no longer be the currency of trade. I would suggest to the Chinese that they should call in their US debt that they hold and demand payment only in gold, platinum, yellow cake, hydrocarbons, or other rare minerals. If the US defaults, the US dollar collapses as it should, and the financial center of the world shifts permanently away from New York and London and western Europe, and to Asia, probably Shanghai. The Saudis should do the same. The IMF and World Bank can be sacrificed to this new system as well.Then, the blow-hard yankees will not be able to "project" any more power, economic, military or political, around the world and full spectrum dominance and pre-emptive war will cease to exist as US strategies of control. Short term Chinese and Saudi pain for long term global sanity and peace.
  79. Tristram Shandy from strathroy Ontario, Canada writes: Flaherty being obstructionist as usual. Too bad he knows so little about finance.
  80. J. Michael from Canada writes: The way things are going I believe there will soon be tremendous pressure on rates to rise. The competition around the world for capital will be intense - the increased competition and risk will drive rates higher. The global market strategy will shift from presently trying to maintain growth (lost cause) to survival.

    One needs to be careful not to be caught with a floating rate mortgage in such a spiral.

    That’s my two cents!
  81. Carl Hansen from Canada writes: Good post Vern. The Chinese will probably get the US reply delivered by an ICBM.
  82. Comments closed, censored, deleted or made to disappear from Mini Bushland, Canada writes: Cosmo Spacely from Canada writes: I wonder if the food that the two people are enjoying in the photo which accompanies this story is contaminated with melamine? --- As a matter of fact, they look disgusted and dismayed because they have learned there was a recall on their salmonella and listeria contaminated Canadian ham and cheese sandwiches. They just heard that many Canadians had already died due to that contamination. --- I understand they will most likely go back to their habit of eating Chinese food.
  83. The Iconoclast from Canada writes: China's stimulus package is spent on infrastructure and social programs, whereas money in the West goes to big banks and corporations. Socialism 1 Capitalism 0.
  84. ss dd from Vancouver, Canada writes: It seems that nobody can live through a recession nowadays. I wonder, when did "recession" become a politically incorrect term ?

    Some people had it too good for too long. They forgot how economy works (that's it if they ever knew to start with). Recessions are NORMAL as they are cyclical. They are times when excesses accumulated during the boom years are corrected: debt excesses, poor management excesses, monetary excesses, fiscal and spending excesses. Recessions might be unpleasant but they are part of the market mechanism. And so far, nobody managed to fool the market... not for too long, anyway.

    There seem to be this theory floating around that you can spend your way out of a crisis. That's like saying you can help your bad mortgage by buying yourself a new car.
    Never worked, never will...

    At least the Chinese do have some money to waste, as opposed to the Americans. Nevertheless, at the end of this exercise in discretionary spending, they'll be left with the same problems but half a trillion short.
    Then, if the American market collapses, they'll be in real trouble since their exports will have few other alternative markets to go to.
  85. martha stewart from Canada writes: Vern Johnson - You seem to have an economic death wish. That's quite the prescription for "global sanity and peace." Perhaps you should burn your house down to get rid of the mice.
  86. Republic of Saturn from Canada writes:
    I think if Canada needs to increase the spending, it must go to the infrastructure. There is a huge infrastructure deficit already.
  87. Republic of Saturn from Canada writes:
    In this round Canada may be one of the biggest winners, since the Biggest Chinese pie will be the railway system. China thinks it has enough express way the next wave big projects are railways.

    In this aspect, both Bombadier and Nortel are at good positions, hope this Canadian government can keep their mouth shut, don't ruin the good business opportunities.
  88. R L from Canada writes: Canada can learn from this.

    Dion for Prime Minister of Canada. Harper is a disaster, and Canada is digging its heels into a filthy 20th century oil economy. Cons seem incapable of long-term thinking.

    I don't care about the Liberal Party, and I would NEVER vote for the likes of ideological Ignatieff. I just want Mr. Dion as Prime Minister. I want the Green Shift, I want the investment in infrastructure, I want an honest good man as Prime Minister (not a sleazy salesman), and I want a progressive Canada that thinks about where it wants to be in the 21st century.
  89. Carl Hansen from Canada writes: I also want the green shift. And a separate highway system for truckers. Give them the old crappy one and build a new one for cars.
    Maybe we could build a chunnel from coast to coast.
  90. scamp the from Canada writes:
    The difference of course is that China can stimulate its economy with cash it has on hand.

    When we 'stimulate' our economy it is done by going into debt.
  91. Uncle Fester from Canada writes:
    Martin's vision is Maurice Strong's vision. It is a dead vision. (not quite dead)

    Sure the EU trades more with the emerging economies of africa and asis than we do, so what? Are we supposed to follow the EU's lead because the LPC's infatuation with all European?

    I think not. Let's follow our own path.
  92. If I had a million lobsters from Halifax, Canada writes: Theres a rumour going around that Obama is gonna invade some country called Canistan. Yeah they are gonna nationalize something called and RRSP to help pay off the US deficit.
  93. Just In from Canada writes: Uncle Fester from Canada writes:
    Martin's vision is Maurice Strong's vision. It is a dead vision. (not quite dead)

    Sure the EU trades more with the emerging economies of africa and asis than we do, so what? Are we supposed to follow the EU's lead because the LPC's infatuation with all European?

    I think not. Let's follow our own path.

    -----------------------------------------------

    And what exactly is "our own path"?

    What happens if our largest customer the U.S. is broke?

    "Buy U.S. treasury bills so that they have the money to buy our stuff"? Is that your idea of "our own path"?

    Do I care whose vision it is including yours?
  94. Matt Stiles from Vancouver, Canada writes: Paul Martin just advocated Global Corporate Fascism.

    This is very dangerous stuff, and Canadians should be very skeptical of the loss of their individual freedoms that goes with increasing centralization of legislative authority.
  95. Just In from Canada writes: Never seen this before. Both the far left and the far right are trying to pick our pockets, seeking bail out. Spin and more spin.
  96. okanagan pakman from Canada writes: Paul Martin doesn't need to go away or apologize to any Harper/Flaherty fans....he left the economy in the best shape it had been in 30-40 years...after 12 or 13 years in power, if they have the fortitude to make the tough choices, then maybe all you CRAPers can crow about the fine management of the country's economy...bloody ingrates!
  97. Sylvia Wilson from Grand Bend, Canada writes: Keeping emerging markets out will not be the policy of Obama. Harper will soon change his mind immediately after the United States changes theirs. :-)
  98. Michael Richardson from Montreal, Canada writes: Sylvia,
    Is that not sad though, that our government has no voice! I seem to remember that we had one not to long ago.
    Uncle Fester,
    Your an uneducated sap of the CPC, no european infatuation necessary to see that. Increased trade with Asia, Africa and the Middle East isn't the european way to the future, it's the only way to the future, 4/5th of the world lives there. Wake up would you?
    Republic of Saturn,
    Excellent post!! Unfortunately that would require vision and coordination from a government that can't tie its own shoe without a siren going off and six PMO officers coming down to claim government interference in the private sector.
  99. R Lyd from Barrie, Canada writes: I think the attached tells you everything you do not what to know about china. You see China ia communist dictatorship , perhaps we forget.

    theglobeandmail.com?query=nortel
  100. Hendrick Larose from Canada writes: Ov