Sober Look — The Gap Before China's Soft Landing

The government assures that China will experience a soft landing during the economy's transition from export and investment-driven growth to internal consumer-driven growth. Now the question remains as to whether China will effectively encourage private consumption and service sector expansion before their old growth model runs out of steam.…

Charts and data.

Sober Look
The Gap Before China's Soft Landing

Marshall Auerback — China Continues To Walk A Tightrope

This is simply a microcosm of China’s greater overall dilemma created by its growth disequilibrium; either it must relax restraints and allow continued rapid debt growth and thereby maintain its high level of investment [with increasingly low returns owing to saturation], or it must reduce debt growth and suffer the consequences of an investment downturn with its threat of an accelerator multiplier contraction.

Macrobits by Marshall Auerback
China Continues To Walk A Tightrope
Marshall Auerback

Stephen Roach — China is Okay

Concern is growing that China’s economy could be headed for a hard landing. The Chinese stock market has fallen 20% over the past year, to levels last seen in 2009. Continued softness in recent data – from purchasing managers’ sentiment and industrial output to retail sales and exports – has heightened the anxiety. Long the global economy’s most powerful engine, China, many now fear, is running out of fuel.

These worries are overblown. Yes, China’s economy has slowed. But the slowdown has been contained, and will likely remain so for the foreseeable future. The case for a soft landing remains solid.

Project Syndicate

China is Okay
Stephen S. Roach — formerly Chairman of Morgan Stanley Asia and the firm's Chief Economist, and currently a senior fellow at Yale University’s Jackson Institute of Global Affairs