Home » Uncategorized » Something about China’s consumption

Search within blog:

Subscribe RSS feed

February 2010
S M T W T F S
 123456
78910111213
14151617181920
21222324252627
28  

Something about China’s consumption

According to Zhang Shugang, a well-known economist in China, China's consumption grew 15.5% over past year.  On the surface, this is exactly what we needed to re-balance China's highly skewed, investment-driven economy

Not yet…

Further look at the data:  69% of the total consumption came from either housing or automobile purchase, with housing expenditure accounting for 55%.  This is out of whack.  Think about how many people were actually buying for speculation only…animal spirits and bubble show up everywhere.

This is a bubble that will eventually go bust.


Leave a comment

Your email address will not be published. Required fields are marked *