"My Career Basically Ended Today": What Is Really Happening In China

Tyler Durden's picture

Two months ago, long before the WSJ and the NYT wrote virtually carbon-copy pieces, we laid out a list of China risk factors which everyone by now is familiar with. These were as follows:

  • a slowing economy crippled by soaring debt, now over 300% of GDP
  • an economy which is overly reliant on fixed investment
  • an artificially high exchange rate which is adversely impacting exports and impairing trade, in a "beggar thy neighbor" world everyone is rapidly devaluing their own currency
  • the feedback loop of plunging commodity prices and highly levered domestic corporation which can not pay their annual interest expense payments at current prices of industrial commodities, leading to surging business failures and defaults
  • a burst housing bubble which recently popped (although slowly growing again)
  • a burst stock market bubble which recently popped (although slowly growing again)
  • Non-performing loans, as high as 20%, and metastsizing across the Chinese banking sector

The market has been struggling to price many of these into any existing investment theses. 

We also said what we think is, as of this moment, is the biggest, and most, underreported risk facing China: social discontent, resulting from a breakdown in recent "agreeable" labor conditions, wage cuts and rising unemployment, leading to labor strikes and in some cases, violence.

To corroborate this, in November we showed a tally of labor strikes through the 11th month amounted to a record high 2,005.  We have updated this to show that in just the last two months of the year, labor strikes in China have exploded, sending the total to a whopping 2,703.


This chart alone, more than any bullshit goalseeked "data" released by the Chinese politburo, reveals all one needs to know not only about the Chinese economy and its collapsing labor situation, but also the social mood because for Chinese workers to dare to protest their employment conditions knowing full well they risk the full retaliation of the state which always frowns upon public displays of dissatisfaction, things in China must truly be on the verge of total collapse.

A useful anecdote to illustrate what is truly happening on the ground, comes courtesy of the NYT which tells the story of how having lost his factory job, one Chinese migrant worker returns home.

Liu Lang, a Chinese migrant worker, left his rural hometown in Sichuan Province two decades ago to work in the factories of the southern province of Guangdong, China’s manufacturing powerhouse. Now, he is moving back.


“I worked my way up from a basic worker to a department head. And my career basically ended today,” Mr. Liu said on the train leaving Guangdong.


Factories in Guangdong have been hit hard by the slowing economy, and many of them have closed, including the shoe factory where Mr. Liu worked.


In 2015, China’s economy expanded 6.9 percent, just below the government’s target of 7 percent, according to official numbers released Tuesday. While the pace would be the envy of many developed countries, it marks China’s slowest economic growth since 1990, the year after the government’s crackdown on protesters in Tiananmen Square.


“My wife and I were both working at that factory,” Mr. Liu said. “We lost more than 20,000 renminbi for the last three months,” he added, referring to about $3,000 in unpaid back wages.

Now multiply this by tens of millions to grasp the severity of the problem.

In the next update, we will read how Liu and millions of his unemployed peers take to the streets, when after months of failed attempts to find jobs they turn violent and demand that the government do something to help them; the same government which is now facing an economic catastrophe.

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venturen's picture

sort of like the oil patch...go there make money...go back home when jobs dry up!

Ghost of PartysOver's picture

SErious unrest could be headed for China.  Especially it President Trump unleashes damaging tariffs.   Once again people, name me one socialist / cummunist / centrally planned economy that has been successful.

0b1knob's picture

Working in a shoe factory is just a job not a career.

I mean a man does what he has to but be realistic.

Row Well Number 41's picture

Not like say, Banker, Lawyer, Politician, etc.  Now those are careers.

Father Thyme's picture
Father Thyme (not verified) Row Well Number 41 Jan 20, 2016 5:00 PM

Or Chairman.

ParkAveFlasher's picture

Or, realtors!  Now THERE is a value add.

Pairadimes's picture

How do you say: "You fucked up! You trusted us!" in Mandarin?

jcaz's picture

Back to the poppy fields, Wang- opium futures UP.

UndergroundPost's picture

This chart alone, more than any bullshit goalseeked "data" released by the Chinese politburo...

Thank you

Theosebes Goodfellow's picture

Something not to be overlooked in all of this is that China's migrant population exceeds that of the ENTIRE United States (350 BILLION +). Think how scary all of them "returing home" broke, dejected and unemployed is, Talk about things "not ending well".

UndergroundPost's picture

This chart alone, more than any bullshit goalseeked "data" released by the Chinese politburo...

Thank you

UndergroundPost's picture

Don't know why this duplicated. Damn phone

Oliver Jones's picture

21st Century equivalent to line echo. :)

JuliaS's picture

The term "career" should not apply unless you are self-employed and/or employing other people. I'm tried of school ads promising students a career in an industry of their choosing. People with careers are typically the ones who either quit college or bypass it all together knowing well ahead of time what they want to do in life.

__Usury__'s picture
__Usury__ (not verified) 0b1knob Jan 20, 2016 5:00 PM



''Those chinamen will be going back to the rice patties on the bicycles they road in on.''...........Mako

Exit through the gift store's picture

Your right! Shoe Factory is just a job. working at the Dildo Factory now that's a career.


Thought Processor's picture



You obviously have not been to many shoe factories in China.  They are multi billion dollar operations now.  Some with very good management.


As an example, any factory that works with Nike must have very high standards (in almost every aspect) to even qualify as a supplier.  



silverer's picture

Yes.  I used to sell materials to the shoe industry.  It's savagely competitive.

Twaddlefree's picture

Okay, right. That doesn't change the fact that a factory WORKER, even one who is now the head of, say, the sole line/department, is not a CAREER. Unless you think that this guy is going to work his way up to VP. Can you see a factory worker at Proctor and Gamble or any automaker calling his job a career? Now, granted, a guy who goes from a rural area to work in the big city and make enough money to buy a cell phone, his own bicycle and maybe even a laptop computer DOES think he's hit the big time and has a "career."


Let's remember that this is EXACTLY the story of the USA and industrialization. And, it's EXACTLY the story of the USA as it falls to the ashes right along with China and everywhere else in the world.

Jam's picture

You sound like a "career" drunk.

11b40's picture

I'm not sure you know what "career" means.  You have a very limited understanding of the word.

"Career is defined by the Oxford English Dictionary as a person's "course or progress through life (or a distinct portion of life)". In this definition career is understood to relate to a range of aspects of an individual's life, learning and work. Career is also frequently understood to relate to the working aspects of an individual's life e.g. as in career woman. A third way in which the term career is used to describe an occupation or a profession that usually involves special training or formal education,[1] and is considered to be a person’s lifework.[2] In this case "a career" is seen as a sequence of related jobs usually pursued within a single industry or sector e.g. "a career in education" or "a career in the building trade".

Calmyourself's picture

Yes, yes high standards, nets in every window to keep the slaves, err workers from prematurely  ending their careers jumping out the window

Antifaschistische's picture

but...how many have been to a Chinese Village?

i can speak from experience...people in most Chinese Villages a) live comfortably  b) eat better than 99% of Americans and c) live where their children receive a better education than in any public school in any large American city.

So....you know, moving back to that village just ain't so darn bad.   Sure, you can't afford any more Coach 'bags' or Nike shoes...but, no one needs that crap anyway.


(on a side note...every single Chinese village still has a collection of beautiful ladies..they are like, Chinese gold nuggets from the dredges of suburbia...)

Crush the cube's picture

At least there are still villages and enough of a subsistence economy to go back to.  Where you going to go in the west when its light out, can't say in the factory, more like EBT card failure.

Freddie's picture

Nike quality sucks.  I have had running and gold shoes made by Nike and they use cheap glue.  The shoes fall apart.  Trayvons love em.   Asics and New Balance are about 10x better.

all-priced-in's picture

Working in manufacturing is a career - the guy was a department head.


How do you define carreer? You need to wear a suit and tie?


You are FOS.





Upton's picture

A career is a government job with full benifits, or a productive financial planner.

Something usefull, helping the ignorant masses invest there 401k money for a golden retirement.

Manufacturing is so 1950's, who needs production planners and injection molding.

JuliaS's picture

Career implies a constant progression dependents only on your personal motivation. A job, in comparison, is a fixed rate endeavour, subject to the law of diminishing returns. In a career the more you do, the more you get back with no upper limit. In a job, increased performance will result in premature exhaustion with little or nothing to show for it.

cornflakesdisease's picture

You obviously don;t know my neighbors.  They have "careers" and three of them have been foreclosed upon on my block in just the last year here in Cinco Ranch, Katy, Texas.  Trust me, they have little or nothing to show for it, including their former six figure salaries.  Best my neighbor Paul has found is a job paying 1/3 of what he was making before.

cheech_wizard's picture

^^^^ THIS ^^^^

I went through that starting in 2008 at the age of 50. It's taken me 7 years and 5 jobs to get back to a point where I am finally getting close to cracking the $100K mark again. (And I have actual skills to sell...)

Standard Disclaimer: Yes, I'm a very pissed off white guy if I dwell on it.

sun tzu's picture

Blew it all on ATV's and waverunners?

cheech_wizard's picture

Try being out of work for 6 months. Try paying Cobra for those 6 months to pay for medications for my wife.

But you didn't have to walk in my shoes, so basically I get to say to you... FUCK OFF.



OrangeJews's picture
OrangeJews (not verified) venturen Jan 20, 2016 4:40 PM

But you get to keep the cancer!

bamawatson's picture

if you like your cancer; you can keep your cancer

Divided States of America's picture

Tyler, i dont give a rats ass about whats happening in China....I want to know what happened in the US in the past hour...Never have I seen such a blatent attempt to stick save the markets..

Soul Glow's picture

It's not time for the crash yet so Yellen threw a few billion dollars into the furnace at Citadel.  She loves watching the way the green ink smokes as it burns.

Thought Processor's picture



Coupled with a short term oversold bounce.  We were due.  But it would be easy to juice the bounce to give it some legs, which I would imagine gets you the biggest bang for your buck.


Watch for the verbal stick saves now.  We should hear some skittle shitting unicorn talk soon, to give this thing some legs.

Thought Processor's picture




Don't worry, the State has their back.  Until it doesn't in which case they're all fucked.



I think we may be about to find out which it is.



BandGap's picture

China needs a couple NFL expansion teams. With games on Thursday night, Sunday, Sunday night and Monday night it should keep them off the streets.

MrNosey's picture
MrNosey (not verified) venturen Jan 20, 2016 6:40 PM

Very sad, but there will be no real recovery what so ever!

The elite will soon run and hide in the bunkers paid for with citizens taxes, after engineering a full economic collapse as well as starting WW3, plus they will make sure that there are enough Jihadi's in the West to start a race war.

That should be enough to cover up the failed fiat ponzi scheme and take care of the 'excessive' population......


Soul Glow's picture

We ended some folks.

Jason T's picture

Scattered Sand.  

It's the name of a book I read a few years ago about the 200 million migrants in china that quite frankly are desparate for work for survival.  

It's difficult to grasp China when you have a nation of 1.3 billion, a lot that got very rich off their migrant population.  figure 500 million living decentely in cities but still 700 million peasents and 100 million living good.  the 200 milliion of hte 700 million who are desparate and willing ot work very cheap.

lot of people : /

Oldrepublic's picture

also a very impressive book called:Factory Girls:From Village to City in a Changing China

souljaboy's picture

Wait until Krugman hears about this.

carbonmutant's picture

What China has is a generation of kids who don't know how to work on a farm...

More Ammo's picture

There are plenty that still work the farms where they have been left alone.  The problem is that the county side is so unsafe since all the people have been disarmed, just as it would be here if minion 0bozo gets his way.

oddjob's picture

Hunger is a great teacher.