I’ve posted before about the Chinese real estate bubble, and what will happen when this bubble bursts.
Rather than worshipping the Chinese economy like Obama does (high speed trains anyone?), we should be recognizing that the Chinese model, like the Soviet model, is artificial and contrived. There is only so much that can be controlled and planned from the top down.
Hold on to your seats; according to The Conference Board, perhaps the most important business oriented forecasting group in the world, revolution is coming to China.
That’s not what the group’s latest global forecast says literally, but this or something like it is the clear meaning of the forecast that China’s growth is likely to slow to 8.7 percent next year, 6.6 percent in each of the four years after that, and then average 3.5 percent per year between 2017 and 2025. It has long been an article of faith inside China and among most China watchers that the country needs 9 percent growth per year to avoid widespread instability.
This does not have to be the Chinese century, unless we want it to be. Or unless we try to be China.