Chapter 35 2. Is increasing GDP a panacea for saving the economy?

China's stock market, on October 16, 2007, the stock index hit a record of 6124 points.The red stock market has investors enthusiastic. At the beginning of 2008, various remarks such as "golden 10 years" and "rushing to 10,000 points" were still heard from time to time. However, today, the stock market has not been able to reproduce the prosperity of the past, and the stock index has not been able to return to 6000 points. The stock assets of most listed companies have shrunk sharply, and the assets in the hands of most shareholders have also followed the stock index. slipping and gradually shrinking.People who calmed down began to think about our road to share reform.

I believe that our readers and friends will be particularly interested in the international financial crisis that began in 2008.From the example we just borrowed from Iceland, we can see that the international financial crisis caused Iceland's stock price to drop by 90%. What impact will the international financial crisis have on us?I hope that through the following space, I can give you a very simple analysis. First of all, I would like to ask everyone to recall that I have made various predictions in my book, and I have never said that I missed it.My estimate of China's stock price is accurate no matter how I say it.In fact, it's not because I'm smart at all. I'm not smart at all, and I'm a bit stupid.The reason why I can speak so accurately is because I found that China's stock market follows a law.The laws it follows fully reflect the fundamentals of our Chinese economy.

When I say this, you must think it is nonsense. Our Chinese economy has an economic growth rate of 10% every year, but we have not seen such a rise in the stock market.You are wrong, that is a superficial phenomenon, do you know how the 10% growth rate of our country comes from?All this is reflected in the stock market. Our country's 10% economic growth is basically driven by steel and cement. In other words, our country has driven economic growth over the past decade through infrastructure construction projects, including bridge and road construction.And this economic growth is not driven by the private economy, but completely driven by infrastructure construction projects.But the problem is that due to a large amount of money invested in this type of project, my country's GDP has become very distorted and deformed.Fixed asset investment in my country's GDP, that is, reinforced concrete, has already accounted for about 55% of GDP.

Because this proportion is too high, consumption is compressed to 35%. Compared with other countries, the structure of GDP is very distorted and abnormal.Let's take European and American countries or Japan as an example. The proportion of their consumption in GDP is not 35%, but 70% or 80%. We are less than half of others.Their investment in fixed assets, such as steel bars and cement, only account for 10% or 20% of GDP, while ours is several times that of theirs.This abnormal phenomenon has made our country's economy maintain a growth rate of 10% every year, making our private economy more depressed, and making the investment and business environment faced by our private economy deteriorate rapidly.

For example, how did China's private economy deteriorate?There are several reasons: first, the continuous appreciation of the RMB exchange rate has hit my country's export manufacturing industry; second, international inflation has increased costs; third, the introduction of the advanced "Labor Contract Law"; fourth, the macro Misjudgment of regulation.Of course, the current government recognizes the serious problems caused by the advanced nature of the "Labor Contract Law", and has made amendments by formulating some implementation rules, but this has already dealt a blow to more than one-third of private enterprises in my country.

Another is the misjudgment of macro-control. Of course, the government also made overall changes in the second half of 2008.However, due to the overly strict macro-control in the past few years, the living environment of my country's private economy has deteriorated rapidly.And what is the result of deterioration?As a result of the deterioration, a large amount of resources flowed out, and even a lot of funds were withdrawn from the manufacturing industry, and the funds diverted from the manufacturing industry were used to speculate in stocks, thus forming a stock market bubble. That is, after I arrived in 2008, if I look back at 2006 and 2007, I will find that the stock market bubble began to form at that time, and it was not because of more successful economic development and wealthier people, as many scholars claim. Therefore, you have more money to speculate in real estate and stocks, and you find that it is not the so-called excess liquidity situation.But as I said, the essence behind the stock market bubble is not that economic development is more successful and ordinary people are richer, but that the manufacturing industry is under the pressure of exchange rate, cost, "Labor Contract Law" and macro-control. Its investment and business environment has gradually deteriorated. As a result, practitioners withdrew the money invested in the manufacturing industry and used it to speculate in stocks, which caused the stock price to rise in 2006.