Is China's economy heading for a crash?

[Black Alloy]

"Markets are well aware that China's exceptional growth rate is finally slackening but economists are increasingly cognisant of this slowing could turn into a crash for the world's second largest economy.

Concerns are beginning to rise about China's future economic prospects. While the International Monetary Fund chose not to downgrade its economic forecasts for the country's GDP, Citi's chief economist Willem Buiter has warned China will drag the rest of the world into a global recession.

China was the main driver behind Australia's mining boom but times have changed. Photo: Bloomberg

"We consider China to be at high and rapidly rising risk of a cyclical hard landing," Mr Buiter and his economist colleagues said in a report. "The reasons behind China's downturn and likely recession are familiar: rising excess capacity in a growing number of sectors, excessive leverage in the private sector and episodes of irrational exuberance in asset markets.

Deutsche Bank research has joined the ranks with a new report that analyses the potential for a hard landing and economic crash in the economy that powered much of Australia's mining boom prosperity.

"Market commentary continues to point to uncertainty about the Chinese economy as an important source of negative sentiment. 'Hard landing' fears, it seems, also persuaded the US Federal Reserve not to raise rates last month," chief economist Peter Hooper said."

Is China's economy heading for a crash?

 

[Obambam]

"Markets are well aware that China's exceptional growth rate is finally slackening but economists are increasingly cognisant of this slowing could turn into a crash for the world's second largest economy.

Concerns are beginning to rise about China's future economic prospects. While the International Monetary Fund chose not to downgrade its economic forecasts for the country's GDP, Citi's chief economist Willem Buiter has warned China will drag the rest of the world into a global recession.

China was the main driver behind Australia's mining boom but times have changed. Photo: Bloomberg

"We consider China to be at high and rapidly rising risk of a cyclical hard landing," Mr Buiter and his economist colleagues said in a report. "The reasons behind China's downturn and likely recession are familiar: rising excess capacity in a growing number of sectors, excessive leverage in the private sector and episodes of irrational exuberance in asset markets.

Deutsche Bank research has joined the ranks with a new report that analyses the potential for a hard landing and economic crash in the economy that powered much of Australia's mining boom prosperity.

"Market commentary continues to point to uncertainty about the Chinese economy as an important source of negative sentiment. 'Hard landing' fears, it seems, also persuaded the US Federal Reserve not to raise rates last month," chief economist Peter Hooper said."

Is China's economy heading for a crash?

Of course we are! We have been crashing every single day for the last 30 years for crying out loud! There is no need to drum it in

 

[vsdave2302]

Yes, china has lost its biggest competative edge of cheap labor now in a scenario of his currency becoming strong and the living standard of their people getting better. All Factor of productions are not very cheap in china, Financial management of china is poor and china is nowhere near or china has no posssibility to become a knowledge based economy. Neither china is a destination like Europe and US where cream manpower across the world shall come and contribute to the develop something. In totality, china has lost edge in all areas including the manufacturing now and china has no capability to transform its economy into next stage i.e knowledge based economy or services. Days of china seems very bleak. Radicalization is also increasing in china at a rapid pace. Down fall of economy shall fuel it further. Tought time of china is ahead.

 

[Obambam]

Days of china seems very bleak.

I have heard this far too many times.

India should forget about cheap labour, as it will lead to increased manufacturing, which will lead to irreversible levels of pollution to your lands, air and environments.

Keep that population level up, this way India won't have to worry about having an aging population, shortages of land, housing, energy or food.

Make English your national language, this way the people won't have to travel to find work abroad. Westerners can come to India for work instead. Heck, make these people work in your call centers instead. Brain drain no more!

Keep up with the tradition, safeguard the country's riches by skimping money on expensive research and development.
Let those westerners do it for you instead. Research and development leads to manufacturing. All Factors of production are bad, It leads to pollution, therefore, very very bad.
Days of India seems very bright. May God bless India not to repeat China's foot steps.

 

[vsdave2302]

I have heard this far too many times.

India should forget about cheap labour, as it will lead to increased manufacturing, which will lead to irreversible levels of pollution to your lands, air and environments.

Keep that population level up, this way India won't have to worry about having an aging population, shortages of land, housing, energy or food.

Make English your national language, this way the people won't have to travel to find work abroad. Westerners can come to India for work instead. Heck, make these people work in your call centers instead. Brain drain no more!

Keep up with the tradition, safeguard the country's riches by skimping money on expensive research and development.
Let those westerners do it for you instead. Research and development leads to manufacturing. All Factors of production are bad, It leads to pollution, therefore, very very bad.
Days of India seems very bright. May God bless India not to repeat China's foot steps.

The problem with your whole post is that OP say about hina going down and you are suggesting India what to do rather than thinking of saving china from desaster. A typical chinese way of thinking about everything except the own weakness.

 

[Nilgiri]

I just got back from a business trip to China....their engine is still humming fine and is finding higher premium growth slowly but surely. One must remember the sheer size of China. Nations like this have enough momentum in their growth phases to cushion to a more consumption-based economy.

I am seeing a transition in China similar to what South Korea experienced in the 80s and early 90s.

There are some persistent worrying parameters but nothing to suggest a massive crash like some seem to think. A slowdown will happen over a cpl decades or so....given China's own diversity (as interior China comes to coastline China economic levels).

It will be an interesting case study for countries like India to learn from which will go through such a phase as well inevitably.

 

[bobsm]

"Markets are well aware that China's exceptional growth rate is finally slackening but economists are increasingly cognisant of this slowing could turn into a crash for the world's second largest economy.

You better hope not.

Australia's dependence on China just went up a notch
JAMES LAURENCESON 27 MAY, 10:58 AM 1

The Australian economy just became more dependent on China. Again.

New data from the Australian Bureau of Statistics (ABS) shows that not only is China our most important trade partner, it’s also on the brink of becoming number one for investment as well.

Australia's dependence on China just went up a notch | Business Spectator

 

[Obambam]

The problem with your whole post is that OP say about hina going down and you are suggesting India what to do rather than thinking of saving china from desaster. A typical chinese way of thinking about everything except the own weakness.

Oh, quit with ya whining.
Since Indian members are so interested in this particular topic, it is good to have a comparison.
Don't be shy now!

 

[vsdave2302]

Oh, quit with ya whining.
Since Indian members are so interested in this particular topic, it is good to have a comparison.
Don't be shy now!

BS,

only 2 or 3 Indian members have commented which shows that indian members are not interested even in discussion of sinking china. They just ignore that.

 

[Obambam]

BS,

only 2 or 3 Indian members have commented which shows that indian members are not interested even in discussion of sinking china. They just ignore that.

It's only 1-2 Chinese drawing comparisons with India, so why so defensive? Rest aren't even interested in the sinking of.. Oops, I meant the rise of supa powa India. They just ignore that.

 

[AnnoyingOrange]

"Markets are well aware that China's exceptional growth rate is finally slackening but economists are increasingly cognisant of this slowing could turn into a crash for the world's second largest economy.

Concerns are beginning to rise about China's future economic prospects. While the International Monetary Fund chose not to downgrade its economic forecasts for the country's GDP, Citi's chief economist Willem Buiter has warned China will drag the rest of the world into a global recession.

China was the main driver behind Australia's mining boom but times have changed. Photo: Bloomberg

"We consider China to be at high and rapidly rising risk of a cyclical hard landing," Mr Buiter and his economist colleagues said in a report. "The reasons behind China's downturn and likely recession are familiar: rising excess capacity in a growing number of sectors, excessive leverage in the private sector and episodes of irrational exuberance in asset markets.

Deutsche Bank research has joined the ranks with a new report that analyses the potential for a hard landing and economic crash in the economy that powered much of Australia's mining boom prosperity.

"Market commentary continues to point to uncertainty about the Chinese economy as an important source of negative sentiment. 'Hard landing' fears, it seems, also persuaded the US Federal Reserve not to raise rates last month," chief economist Peter Hooper said."

Is China's economy heading for a crash?

Chinese economy is going nowhere...its here to stay for a long long time...It will slow down a little ... but still continue to grow... Days of breakneck speed in growth are gone now.. but the economy will continue to grow at nominal rate.