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Economists (e.g. Michael Pettis) were already calling China out for its long history inflated numbers when the 2007-2009 crisis erupted. Perhaps this view might
by ddebernardy 8y ago
Economists (e.g. Michael Pettis) were already calling China out for its long history inflated numbers when the 2007-2009 crisis erupted. Perhaps this view might go mainstream with the looming recession?
- JumpCrisscross 8y ago> Perhaps this view might go mainstream with the looming recession? Nobody, including Beijing, took China’s official statistics at face value. What’s novel in this work is the larger-than-expected magnitude of the error.
- ddebernardy 8y agoThe article mentions China overstated its growth by an average of 1.7 percentage points per year since 2008. Best I recollect from back when I was reading Pettis' blog on a regular basis, that figure is actually lower than what he was been suggesting China had been overstating its growth by in the decade prior to 2008. Pettis is about as specialized in China financial markets as you can get, having basically studied and blogging about the stuff exclusively insofar as I'm aware while living and teaching finance there. He has many criticisms of how China is reporting numbers. One in particular is that local officials are expected to meet certain GDP targets. When the numbers don't look like they'll be in, they'll take on debt and build a bridge to nowhere to make their numbers. The point being, from where I'm standing from there doesn't seem to be anything new in the magnitude of the error. (It's great if the article made you privy about how overstated the economy was.)
- vkou 8y agoEconomists have also predicted 5 Chinese recessions, and 4 American ones in the past decade. That the bubble will pop isn't very interesting. When, is.