Chinese slowdown to occur?

In one year, the Chinese economy will perform poorly. That is, they will have a recession This could be a technical recession from a gross rate of say 10% per year to 3% per year, then it is a recession. You also shouldn't believe in the gross GDP that China reports. If you adjust for the real rate of inflation, then true growth is even slower.  


See report at : http://www.youtube.com/watch?v=g-Cz45S5Bos


But the question to be asked are:-


a) will u be putting in money into the American market and the possible decline in dollar.
b) Eurozone issues such as Greece is still not resolved and Spanish home loan defaults are rising rapidly.
c) Najibnomics to occurs after GE13? Massive inflationary pressures?


What would be a sustainable/growing economic system for the next 5-10 years?

Food prices surge in China.

Grim news from China:-

a) Inflation rate is at 4.9% (Jan '11) compared to 4.6% (Dec'10)

b) Jan'11 : Surges include

Eggs up by 20%

Fresh fruits by 33%

Sugar up by 80%

High grade rice more by 65%

c) What this means is that millions of the poorer Chinese households which spends half their income on food will experience severe economic setbacks - 50% spending of income on income might translate up to 70%.

d) Remember also that crude oil is now at USD$100 and standing by. The Chinese folks still needs to pay for transport somehow.

e) Food prices hikes were recognised as one of the catalyst in bringing down the governments of Tunisia and Egypt.

China in 2011?

Hopefully, China should make the move to tighten their grip on inflation.

See Mssr Rogers

http://www.youtube.com/watch?v=Ja9qC0tYW2Q

WHY CHINA ? PLUG IN NO 2

Greedy guy writing again.

Today (Jan 2011), China purchases more cars and mobile phones than the US and soon will buy more computers.

Nomura Securities estimated that by 2014, retail sales in China may surpass that of the US.

China has also announced that it will spend USD 1.5 trillion on high speed rail and nuclear power. Not all at once but normally within 5 years (the basic 5 year plans mah!)

http://www.themalaysianinsider.com/business/article/china-plans-to-spend-big-on-nuclear-power-high-speed-rail/

Simple language folks :

China's infrastructure currently is a BIG MESS and yet there are still hitting low double digit growth rates (due to FDI).

There are insufficient rail lines for their own citizens to get back home for CNY that some ppl are resorting to wearing diapers as some have to stand 17 hours on a packed cattle class train. In addition, certain rural areas in China, overloads occurs when people more than 5 households switches on their air-cond/chandelier/ etc.

But what happens when China upgrades its infra and fully capitalises on 1.4 billion of its own internal market?

FDI + Huge Market internally = >10% growth (current growth at slightly over 10%)?

Using simple maths, China's market growing at 10% annually will just DOUBLE after 7 years!!!

Folks: Another thing? China will be buying raw materials and consumables in order to manufacture USD 1.5 trillion worth of infra - what will be the effects of this buying binge on commodities prices?

Buy some Chinese based unit trust + commodities funds!