Whither China?

A forum for discussing macroeconomics
Post Reply
User avatar
nanningbob
Trader
Posts: 4560
Joined: Sun Dec 04, 2011 1:23 pm

Whither China?

Post by nanningbob »

Almost 15% of China's GDP comes from real estate. That is not sustainable and if it comes down to a more normal 6-8% China will have a no growth economy. Here is a note that came out:

China’s weakening property market poses an increasing danger to local governments, threatening to strain their finances and intensify an economic slowdown. Land sales in 20 major cities fell 5 percent in March from a year earlier, the biggest drop in at least a year, according to China Real Estate Information Corp. data compiled by Bloomberg. The value of land sales in third-tier cities declined 27 percent last month, according to SouFun Holdings Ltd., the nation’s biggest real-estate website owner. Failure to find other revenue sources increases the risk of defaults and financial turmoil that curb economic expansion already...

http://www.bloomberg.com/news/2014-05-0 ... ances.html

Since most local govts in China rely on real estate for their tax income what happens to them when it stops or slows down.
I trade http://www.stevehopwoodforex.com/phpBB3 ... =38&t=3964,
I talk about my philosophy of trading here.
http://www.stevehopwoodforex.com/phpBB3 ... =38&t=3627
"The key to converting something useful to others is simplicity. Complexity is the enemy to execution." Tony Robbins
Post Reply

Return to “Macroeconomics and the Forex markets”