Liu Junluo: Historic Testimony of "Chinese Housing Prices in This Multi-polar World"

Here's an English translation of Liu Junluo's most recent blog. He has some unorthodox opinions which differ from both Chinese and U.S. mainstream opinion. He expects the U.S. dollar will rally strongly this year, among other things. Perhaps his most interesting opinion is that the U.S. is on the verge of a new renaissance, and that its policies are far more calculated than even bullish Americans would think. Also, he seems to allude that his economic warnings resulted in an incident with the police over an animal shelter for stray cats that he runs with his wife.

The reference to Ah Q can be explained in this wikipedia entry. It's a harsh way of saying someone is self-delusional.

I haven't done translation since college. I tried to stay as close to his words as possible, but in some places I translated the ideas. Any errors in translation are my own and I welcome any corrections.

Historic Testimony of "Chinese Housing Prices in This Multi-polar World"
by Liu Junluo

China's economic commentators say that "The Lehman Brothers bankruptcy is a manifestation of the decline of the American era. "This "stupid" way of thinking is a standard answer from Lu Xun "Ah Q" philosophy which is an element of Chinese culture. Today, the size of U.S. debt is nearly 400% of GDP, the highest in U.S. history.

Before the outbreak of America's Great Depression in the last century, the U.S. debt reached 375% of GDP. These two different periods of U.S. debt to GDP ratios have no significant difference. Yet technical progress, social and legal systems and cultural inclusiveness makes the United States much much stronger today than in 1930. So should Americans not be afraid of the debt? The answer is yes.

Therefore, for former Federal Reserve Chairman Alan Greenspan and current Federal Reserve Chairman Ben Bernanke, correcting the massive U.S. trade deficit and the huge U.S. current account deficit has never been their objective. Even in Mr. Bernanke's testimony before the U.S. Congress, he clearly expressed that he does not want an adjustment to the United States' large current account deficit. Therefore, the objective of U.S. monetary policy is clear. That first and foremost macro economic interest of the United States is the cost of borrowing. Lehman Brothers bankruptcy caused all the world's major central bank interest rates to hit historic lows. Today, the U.S. national debt interest expense to GDP ratio is historically low. As far as the deeply indebted U.S. is concerned, this is not a gift given by Lehman Brothers, this is another God-given new era in the United States, including the return of American wealth.

Are Americans stupid? Are they crazy to borrow from the world? In particular, Chinese are America's biggest creditors. Since 1970, the United States embarked on an ambitious transformation, America's "de-industrialization." The American's goal is clear—all the labor-intensive industries need to completely disappear. Today, Americans can proudly announce that, let the Chinese, Koreans, Indians and Vietnamese compete in textiles, iron and steel, shipbuilding; let the Japanese and the Germans fiercely compete in the automotive industry, mechanical industry and chemical industry.

Meanwhile, the Americans have Microsoft, Google, Apple, Wal-Mart, Yale and Hollywood. The cost of this first big industrialized country's successful "de-industrialization" is about $3 trillion in foreign debt, or about 20% of the U.S. economy. Americans spent a full 40 years experiencing a large amount of industrial sector unemployment and family bankruptcies, and established an "Age of American Renewal" which features the control the global industries through their pioneering in the knowledge industry.

The "Age of American Renewal" is near, and they should thank the Japanese, Germans, the ASEAN people and Korean people for a lot of cheap goods and cheap financing. The funny thing is to ask the stupid "Chinese economists" who have the spirit of "Ah Q", to answer why China holds more than 2 trillion U.S. dollars in foreign exchange reserves. And these more than 2 trillion U.S. dollars foreign exchange reserves are according to 1950s accounting rules. If we have lots of courage to take the U.S. multinational corporations profits from global sales, including the monopoly profits from U.S. technological processes, add into the calculation the U.S. government debt and China's official foreign exchange reserves...then even the real "Ah Qs" will know, we are dumping our resources in the same manner as the Great Leap Forward.

Human history is entering a period of population overload. India's per capita arable land area is three times that of China, and the Indian climate is much better than that in China. China's industrialization and urbanization means that Chinese people's children and grandchildren will rely on American soybeans for survival.

In 2007, China's stock market was around 4 to 5 thousand points, I was saying that America's strategic objective in 2008 was for China's stock market to plummet to 2 thousand points, while the Chinese property market enters a frenzied wave of appreciation. Any rational person saw China's skyrocketing property market throughout 2009.

This is the collective action of Chinese savings hedging the risk of inflation. This is the inevitable consequence China's lack of public goods, such as the lack of free medical care, lack of free education, the inevitable result of low wages as well as an agricultural system controlled by the government. Because wages are too low, Chinese have strong desire to own their own home, rather than bear the burden of rent. In 2009, China's property market is just the product of pension savings and the desire to exchange their low wages. In "Chinese Housing Prices in This Multi-polar World", I explained how the United States uses U.S. resources to control China's monetary policy, to achieve U.S. strategic goals, for China's entry into the final state of collapse—when a large number of Chinese pension savings are tied up in Chinese real estate.

Not long after I published "Chinese Housing Prices in This Multi-polar World" on November 5, 2009, that same year in December, a Wall Street hedge fund manager [Chanos] said that China's housing bubble was 1000 times Dubai; and recently "Euro killer" Soros began predicting that China's property market will collapse in 2010. Also, in "Chinese Housing Prices in This Multi-polar World", published November 5, 2009, the ending says the America's 2010 strategic goal is a rapid appreciation of the U.S. dollar and a collapse in the Chinese property market. Why is a U.S. hedge fund manager and "Euro killer" Soros's thinking so consistent with the author's?

This is a question of perspective; if you try to see America's strategic interests in China's monetary policy, then the answer is very clear. So, that is why the U.S. central bank's monetary policy never had correcting the massive U.S. trade deficit and the huge U.S. current account deficit as its goal. Around May 2008, the author was intensely calling on China to prevent the United States' strategic goal in 2008- a Chinese stock market crash in 2008, and then a skyrocketing Chinese property market.

A large group of Shanghai police and a large group of city officials rushed to my wife and mother who adopted stray cats, injuring them, and my 70 year old mother cannot help but get hit, at the scene she had two broken ribs. I reported the incident to the authorities, but was ignored. Later, I complained to the Shanghai police inspector and was told I had insufficient evidence. At that time I was in Shanghai, I wrote on the big police inspector's board-black is white, history will show many of today's wrongs.

The future of human society is an intellectual society, water resources and agricultural society, excellent medical society, environmental and multi-cultural society, these and all of us, and our children and grandchildren, are not relevant.

China's mainstream economists are the useless product of China dumping its resources. Chinese home prices and the Chinese economy are entering a major collapse to last more than two decades, along with a turbulent period of social upheaval. This is America's only strategy in 2010.

The emergence of "Euro killer" George Soros should remind people that he was the instigator of the 1997 Asian Crisis. China's real economic problems will come from Vietnam's economy, India's economy, including the most terrible impact of the collapse of the Japanese economy. In this regard, China's mainstream "Ah Q" economists are just self-deceiving idiots. A group of people deceived by "Ah Qs" have bad luck; a nation deceived by "Ah Qs" in a globalized economy is a nation that will go extinct, a nation that will be in last place.

I'm very pleased to publish this book on November 5, 2009. This book will be as I wrote to the Shanghai police inspector "history will bear witness to much of today." And this book will inevitably become a powerful testimony of why China's housing market China's economy suddenly collapsed.

Thank you,

Liu Jun Luo

March 9

(2010-03-09 21:19:40)




2009年11月5 日出版的《多角世界下的中国房价》出版不久,同年12月份,美国华尔街对冲基金巨头抛出——中国房价泡沫远比迪拜1000倍严重;而近期“欧元杀手”索罗斯也开始预言——中国楼市2010年崩盘。而2009年11月5 日出版的《多角世界下的中国房价》这本书结尾就是“美国2010年美国战略目标——2010年美元暴涨,2010年中国楼市崩盘”。那为什么美国对冲基金老板与“欧元杀手”索罗斯的思维会与笔者如此一致呢?那是因为视角的问题,您如果能尝试从美国战略利益来配置中国货币政策,那答案就会非常明确。所以,这就是为什么美国中央银行货币政策从来不以纠正美国巨额贸易赤字和美国巨额经常账户赤字为目标。2008年5月份,笔者正努力在中国呼吁一定要防止美国2008年战略目标——2008年中国股市崩盘,而中国楼市将会进入疯狂主升浪的美国战略时刻。一大群上海警察与一大群城管大爷们冲到夫人与母亲收养流浪猫的暂借地,打伤夫人与母亲,母亲70高龄不禁打,当场打断两根肋骨,笔者报案,无人理会。后来向上海警察督察大人们投诉,被告知笔者证据不足。当时笔者在上海警察督察大人们的通知单上写到——颠倒黑白,历史会见证下今天许多许多。未来人类社会是脑力社会、水资源与农业社会、优秀医疗社会、优良环境与多元文化社会,这些与我们所有人包括我们的子孙是无关的。中国主流经济学家们是中国贱卖中国资源时代的垃圾产物。中国房价和中国经济正在进入一场二十年以上的大崩溃时期与中国社会大动荡时期。这是美国2010年的唯一战略。今天“欧元杀手”索罗斯的出现,让人更应该想起这位曾经也是1997年亚洲金融危机的煽动者。未来中国真正的问题是来自越南经济、印度经济,包括最可怕的日本经济崩盘的冲击。对此,中国“阿Q们”的主流经济学家们,这群草包们,只会自欺欺人。一群人被“阿Q们”骗是一群人倒霉;一个民族被“阿Q们”骗,在全球化中是一个民族的灭亡,而成为全球化的下等人。非常高兴2009年11月5 日出版的《多角世界下的中国房价》这本书。这本书将像笔者写给上海警察督察大人们的一句话——历史会见证下今天许多许多。而《多角世界下的中国房价》这本书在未来必将成为中国房价和中国经济为什么会突然崩盘的一部有力的见证史。
多谢2010年 3月9日

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