Over 40% of ALL the world's economic growth comes from China

[beijingwalker]

Who's Afraid of China?
by John Blank
January 25, 2013 |

over 40% of ALL the world's economic growth comes from China

If your stocks have limited China exposure, then don't expect outperformance in 2013. Exposure might be buried in revenues or equity risk taken directly, but it MUST be there. That is because China is a market elephant now; you can't avoid it.

The internal migration reshaping the country? - Epic
Its demand growth? - Picking up
Investment signals? - Positive!

All of this provides a strong catalyst to take shares higher. So in the next few paragraphs, I am going to show you what is going on with China and how to invest more successfully in 2013 because of this key trend.

What is Going on With China's Economy?

China's consensus GDP forecast is rising.

Growth is forecast at +8.1% for 2013 after +7.7% in 2012. We heard much about China's slowdown, but not much about its current recovery. Truth is, over 40% of ALL the world's economic growth comes from China -- no small matter for investors.

Inside China's financial markets, I see upside -- China's retail sales are up +14% year over year. With low forward P/E ratios, Chinese stocks look reasonable even after the recent eight-month long rebound. China's managed currency may be a political hot potato, but it lowers currency risk for investors.

China's CYCLICAL slowdown signaled its end in June 2012.

The 2012 slowdown was a back-end signature of their huge 2009 fiscal stimulus. Late in 2010, tight money began to attack a housing price bubble. Two years later, slower growth cooled prices, and put in place a stable expansion.

In June 2012, the People's Bank of China [PBC] cut its average 6.5% rate to 6.0%. It can go to 5.3% to match the 2010 low. To skeptics who see slack, I ask this: Why doesn't the PBC go to 5.3%?

After ending speculation, housing bottomed. Prices have come down -10% to -15%. Wage growth of +10% to +20% a year means home affordability is up +30% to +50%. Now, home and auto sales - accounting for 40% of China's consumer spending - should pick up.

More . . . Who's Afraid of China? - Zacks.com

 

[Chinese-Dragon]

Of course, an 8+ trillion economy growing at 7-8% per annum is nothing to sneeze at.

I just hope we can keep up the positive momentum for at least the next decade, being able to sustain 7% growth for the next 10 years would be a dream come true.

 

[hari sud]

Who is that growth for?

If it is export oriented growth, then is no good for the Chinese people. All that is good is that, pollution, acid rain, exhausting of its natural resources goes on the name of growth.

Bad growth model.

 

[Chinese-Dragon]

Who is that growth for?

If it is export oriented growth, then is no good for the Chinese people. All that is good is that, pollution, acid rain, exhausting of its natural resources goes on the name of growth.

Bad growth model.

Wrong. The majority of Chinese growth comes from domestic consumption. Followed by Investment. (Net exports are actually a drain on our economic growth.)

Here is an article from the Financial Times:

Financial Times - China unlocks right kind of growth

China has never lacked for growth over the past decade but it has suffered from the wrong kind of growth, developing a dangerous reliance on investment.

Tucked into its latest economic data was evidence that the country has finally started to address this problem. Consumption clearly surpassed investment as China’s biggest growth engine, reinforcing a trend that emerged earlier this year – and something that has rarely happened over the past decade.

In the first three quarters, consumption accounted for 55 per cent of growth, while investment contributed 50.5 per cent. With external demand weak, net exports actually subtracted 5.5 per cent, according to data from the national statistics bureau.

Composition of Chinese GDP growth:

Consumption - 55%
Investment - 50.5%

While Net exports actually SUBTRACTED 5.5%.

 

[beijingwalker]

Who is that growth for?

If it is export oriented growth, then is no good for the Chinese people. All that is good is that, pollution, acid rain, exhausting of its natural resources goes on the name of growth.

Bad growth model.

it's the people who benefit,Japan and Korea are also export oriented economy,but they are generally regarded as economic success,they rely on export much more than China.China,on the other hand,has world's biggest consumer market,with cash in hands,Chinese people now become the biggest consumer group in the world.the purchasing power of Chinese people can be seen around the world.

as for pollution,UK,US...all past economic and industrial super powers all experiece this,later on they got enough money to address and ease that problem.and lets look at India,almost no manufacture industry comparing to China,but even more polluted than China,that's really a bad model.

 

[Chinese-Dragon]

Who is that growth for?

If it is export oriented growth, then is no good for the Chinese people. All that is good is that, pollution, acid rain, exhausting of its natural resources goes on the name of growth.

Bad growth model.

Actually, India has the most toxic air out of any country in the world.

The Hindu - India has the world's most toxic air: Study

It is official: India has the world's most toxic air.

In a study by Yale and Columbia Universities, India holds the very last rank among 132 nations in terms of air quality with regard to its effect on human health.

This is according to a 2012 study by Yale and Columbia Universities.

So basically, you don't have the mass manufacturing/exporting capabilities like the East Asian countries have, yet you still have the most toxic air in the world.

That is not a very good trade off at all. So maybe you should be more aware of the facts before you start criticizing our growth model using illogical reasoning. There are plenty of actual problems with our growth model that don't involve you inventing and making up random crap.

 

[faithfulguy]

it's the people who benefit,Japan and Korea are also export oriented economy,but they are generally regarded as economic success,they rely on export much more than China.China,on the other hand,has world's biggest consumer market,with cash in hands,Chinese people now become the biggest consumer group in the world.the purchasing power of Chinese people can be seen around the world.

as for pollution,UK,US...all past economic and industrial super powers all experiece this,later on they got enough money to address and ease that problem.and lets look at India,almost no manufacture industry comparing to China,but even more polluted than China,that's really a bad model.

Can any Indians explain why such a bad pollution India without any manufacturing. I'm curious on how this is done.

Who is that growth for?

If it is export oriented growth, then is no good for the Chinese people. All that is good is that, pollution, acid rain, exhausting of its natural resources goes on the name of growth.

Bad growth model.

Are you the Hari Sud that wrote for UPI Asia. What happened to ht gig?

 

[imran_ind]

Got to agree with the OP Nothing to troll here .... Gud Going china

 

[rcrmj]

Who is that growth for?

If it is export oriented growth, then is no good for the Chinese people. All that is good is that, pollution, acid rain, exhausting of its natural resources goes on the name of growth.

Bad growth model.

apart from ignorance and reading comprehension whatelse do you have? do you even read the article. going by your logic India is worst growth model, as almost no manufacturing sector yet has the worst acid rain and pollution``pathetic isnt it?

 

[terranMarine]

apart from ignorance and reading comprehension whatelse do you have? do you even read the article. going by your logic India is worst growth model, as almost no manufacturing sector yet has the worst acid rain and pollution``pathetic isnt it?

If they have manufacturing sectors the pollution will get even worse than that. It's an obsession to criticize China and they are enjoying it. Let them have their fun while we widen the gap.

 

[Echo_419]

Who's Afraid of China?
by John Blank
January 25, 2013 |

over 40% of ALL the world's economic growth comes from China

No need for TROOOOOLING

Well done china

 

[karan21]

1947 and 1949 saw the birth of the poorest nations of the world. Both full of millions of humgry and diseased people.
1978: Chinese economic reforms.
1978- India was ahead but China over takes and starts growing faster over 9%.
1991- Indian economic reforms achieveing over 7% growth.
2000- Chinese and India are both developing economies.
2010- China becomes a middle class country and largest manufacture, India still poor and developing.
2015- CHina becomes worlds largest investor and holds largest reserves more than rest of world combined. Meanwhile India still developing and poor.
2025- China becomes High income country with first world living standards, India finally inches close to middle income countries taking over taking Japan economically.
2030- China becomes the biggest inovator in the world. Chinese rule the scientific world and a high standard of living. India still relitively poor and developing.
2035- CHina is the biggest superpower ever on the planet. Their economy is 3x USA. India inches close to American economy but still relitively poor and developing.
2040: China becomes a democratic nation finally the west thinks of China as a friend rather than an enemy. Meanwhile Indians still poor and developing.
2070: India finally becomes high income country.


We Indians will see a nation go from bottom to surpassing us to becomes the top dawg of the world. Unfortunate but true, this will happen right infront of our eyes. CHinese do it much bigger and faster.

Thumps up if anyone agrees with my predictions.

 

[timetravel]

@Karan you take very downside view of India.. not agreed

China is doing well and it is good for India also as China is a big market. If China invests in India then good for India and Indian companies can also tap the huge Chinese market. win win.

But China needs better government. World is not in favor of an aggressive and expansionist China. If the leaders of China make a mistake by being overcome with OVER CONFIDENCE all the progress could be lost by war and destruction. Also China cannot sustain a much bigger economy without outside world markets and their cooperation and good will. Chinese aggression as a result of their growing money and power and its effect on the sensibilities of their leaders is the biggest challenge for China in coming decades.

China will rise till it remains peaceful and so would India and India-China would be the biggest markets, consumers and producers in the world. Cooperation could bring great benefits to the people of the two countries.

 

[Cherokee]

how much percent of world's economic growth is India ??

 

[Audio]

Who's Afraid of China?
by John Blank
January 25, 2013 |

over 40% of ALL the world's economic growth comes from China

lol at the article. It offers us such gems of wisdom as:

By 2013, there will be 1.36 billion people in a China with $18 trillion in GDP, at constant prices. By 2015, GDP gets to $21 trillion. In two years, $3 trillion in new spending materializes - 20% of the current U.S. economy.

This is obviously a scam site promising millions in investment returns if you invest in China through their enterprise. Would not surprise me if the employer of the opinion shapers has something to do with it as well.
Good thing they are not so smart and they dont read the article to the end to see how the author shoots himself in the foot.
I guess, with the multitude of articles that need to be posted to keep motherland's image shiny, one just skims through the first paragraphs. If it's says good, it's going on a forum somewhere!