Interesting article on the Chinese money supply and first day of the annual Davos World Economic Forum

I was just scrolling through the several blogs that I read every single day, which include the Marginal Revolution. I have found a very interesting article on the Chinese money supply that Tyler Cowen had posted as a blog earlier in the wee mornings on the first day of the annual World Economic Forum in Davos. The article was quite striking for two reasons:

1. The first reason was the point about the Chinese M2 money supply being 70% higher than the "rather tight" US money supply despite the much "smaller" size of the real Chinese economy versus the US economy. This is particularly interesting as it just shows how the much maligned Federal Reserve is actually more fiscally tight and conservative than their much more activist Chinese Central Bank counterparts. From what I gather, this might also be a false indicator of what the actual GDP growth in China is.

2. This is where my second reason for writing this thought bubble that I had about reading this particular blog that Tyler had written. From the Financial Times article that Tyler had posted in this blog entry, written by Derek Scissors from the American Enterprise Institute, we can conjecture that the Chinese economy will face an extremely rocky road in the coming years. It's a pretty cool article to check out, especially with his particularly interesting views. The Chinese economy might be in trouble in the short term, but I think it might still go pretty smoothly in the longer term.

It is also the first day of the annual Davos World Economic Forum! For those who are not familiar: The Davos meeting is the annual gathering of some of the world's most powerful economic elites, where they gather to discuss some of the pressing challenges that our world faces. It has been around for 40 something years and here are two articles that are worth reading about the contents of the meeting.
2012 New Yorker article 
2015 The Guardian Opinion article

Interesting topics that these powerful people will discuss over the course of the meeting include increasing political instability, global income inequality, climate change, oil and their most pressing topic: financial instability! As many of us know about the rocky world economy and they will be discussing the financial instability that the world is currently/going to face in the coming years. The videos on the earlier World Economic Forum link that I had posted will hopefully interest those that might be interested in the World Economic Forum!

It's been a while since I've posted a blog entry, mainly because of other more urgent tasks that I had to handle this week. I will be posting lots of entries the next couple of days, as it is the exciting week of the World Economic Forum! I will be watching/following the events that unfold in the lovely Swiss resort city of Davos, Switzerland, but also I will be posting another blog post on thoughts about a rather marginal economic theory that I think has some relevance in the current economic turmoil.