China s Excess Capacity Nightmare

There are still a few million surplus workers in Central Asia.

Finally, Spaniards could borrow excess German savings and increase consumption and investment.

In normal times, there are valid reasons for paying interest on excess reserves.

NATO has been involved in the destruction of a number of surplus stockpiles.

As a result, China now faces the problem of short term excess capacity.

Investors might choose other places for their excess cash, like banks.

This is slowing the absorption into the economy of the excess resources in the construction industry.

(vi) Proceeds from the sale of surplus property are credited to the miscellaneous income of the respective funds.

The interest rate on these totally safe and liquid deposits induced the banks to maintain excess reserves at the Fed instead of lending and creating deposits to absorb the increased reserves, as they would have done before 2008.

But the more immediate problem remains deflation, given high unemployment and excess capacity.

But the new Fed policy of paying interest on excess reserves meant that this increased availability of excess reserves did not lead after 2008 to much faster deposit growth and a much larger stock of money.

As a result, all of this excess liquidity is flowing to the financial sector rather than the real economy.

China now stands ready to absorb some of that surplus saving to promote a shift toward internal demand.

The only way to sustain economic growth in the face of such an imbalance is to borrow surplus savings from abroad.

Given China s massive stock of surplus labor, this trend will not reverse itself soon.

The link between bond purchases and the money stock depends on the role of commercial banks excess reserves.

Through this control and manipulation of surplus resources, the elite's power continued to grow until about AD 950.

The surplus assets (due to the phasing down or closure of an operation, awaiting redeployment) were not reported.

China s excess capacity problem reveals a serious defect in its socialist market economy.

But, by raising the consumption share of its GDP, China will also absorb much of its surplus saving.

Excess capacity and falling growth are mutually reinforcing. Not only does excess capacity have a negative impact on growth perhaps more important, sharply declining growth also contributes to massive redundancy in some industries (especially resources and the heavy and chemical industries).

To correct China s excess capacity problem would require the relevant enterprises, whether SOEs or private firms, to exit the market.

Even if real wages increase in some coastal cities, surplus labor could keep the national average flat.

More approaches like this and concerted efforts to find markets or uses for surplus food are needed.

The Federal government has thrown fiscal prudence out the window. The country as a whole is absorbing an astounding three quarters of global excess savings.

The only way to meet growing demand was to use OPEC s spare capacity and commercial inventories.

The larger deficits would also eliminate all of the excess saving that now underpins the current account surplus.

But, as long as Germany does not absorb its excess savings and accommodate the desired rise in Spanish savings, Spain is still faced with the same options.

The US government s loss of its AAA rating is a first sign that the most important outlet for excess Chinese savings might be losing its luster.

To raise these extra amounts, the Obama administration could levy an excess profit tax on Wall Street to make up the budget gap.

The latter category includes income from sales publications, interest earned on surplus funds and other sundry items for which details are provided in a separate section.

PM Last night we gave it a few too many turns and it tried to bash the roof out also. It's about a gram.

First, in a situation of widespread unemployment and excess capacity, short run output is determined primarily by demand, not supply.

In Germany, banks earn close to nothing on the hundreds of billions of euros of excess liquidity that they have deposited at the ECB.

Cheap funding and land revenue have led to excess infrastructure and industrial capacity without adequate market discipline.

Moreover, the younger countries are typically emerging markets, which have neither the scale nor the capacity to absorb the world s excess savings efficiently.

If they remove the stimulus too soon by raising taxes, cutting spending, and mopping up the excess liquidity, the economy may fall back into recession and deflation.

The legacy of excess real estate capacity and over leveraged households makes recovery all the more difficult.

Given the high levels of excess capacity and unemployment in Europe and America, quantitative easing is unlikely to trigger a bout of inflation.

It should stop paying interest on excess reserves until the US economy returns to a more normal footing.

For when I shall have brought them into the land which I swore to their fathers, flowing with milk and honey, and they shall have eaten and filled themselves, and grown fat then will they turn to other gods, and serve them, and despise me, and break my covenant.

For when I shall have brought them into the land which I sware unto their fathers, that floweth with milk and honey and they shall have eaten and filled themselves, and waxen fat then will they turn unto other gods, and serve them, and provoke me, and break my covenant.

To ensure that excess stockpiles of fissile material remain outside the military nuclear cycle, the principle of irreversible disposition should prevail.

Inflation falls at last, but growth slows more than desired, owing to the overcapacity that resulted from excessive investment in the earlier phase of the cycle.