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China's Huge Money Supply caused by high saving rates??? [Copy link] 中文

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Post time 2013-3-12 06:02:36 |Display all floors
China's ratio of M2 to GDP rose to 188% of GDP last year--up from 154% in 2002, said by the head of China's Central Bank, Zhou Xiaochuan in a interview with newspapers, which published in newspapers in March 8, 2013.

Why do China have such a High level of Money Supply?
It was caused by high saving rates, said by the head of China's Central Bank, Zhou Xiaochuan.
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Gold Medal September's Best Writer 2012

Post time 2013-3-12 06:28:25 |Display all floors
Let us do a comparison of the ratio of M2/GDP between China and United States

Original data of M2/GDP from China's NBS.
M2/GDP ratio from worldbank.org

 

China

United States

year

M2/GDP

M2/GDP

1990

82%

73.9%

1991

89%

72.7%

1992

94%

68.7%

1993

99%

65.8%

1994

97%

62.2%

1995

100%

63.3%

1996

107%

64.7%

1997

115%

65.6%

1998

124%

67.9%

1999

134%

69.8%

2000

136%

71.0%

2001

144%

73.7%

2002

154%

74.4%

2003

163%

74.2%

2004

159%

73.8%

2005

162%

74.9%

2006

160%

77.1%

2007

152%

82.1%

2008

151%

87.2%

2009

178%

88.6%

2010

181%

83.7%

2011

180%

86.6%

2012

188%




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Post time 2013-3-13 08:02:25 |Display all floors

It q

This post was edited by pantarhei at 2013-3-13 08:04

Saving money doesn't create money though. Lending money does. You can see that clearly in the frivolous lending spree to companies in 2009 to keep running engine running.It was government that opened floodgates , not private savers. The goverment used the savings of the private people to do it though.

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Post time 2013-3-15 00:28:43 |Display all floors
pantarhei Post time: 2013-3-13 08:02
Saving money doesn't create money though. Lending money does. You can see that clearly in the frivol ...

Saving money doesn't create money though. Lending money does.

Agree.
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