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5 Reasons to Worry about China's Economy

Date post:23-Aug-2014
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New data released by the Chinese government suggests that its real estate bubble may have popped and its economy is feeling the effects.
Transcript:
  • Reasons to Worry about Chinas ECONOMY
  • Since the financial crisis, China has served as the engine of the global economy.
  • While the United States & Europe remain mired in economic malaise
  • Chinas miraculous ascent has continued.
  • -4% -2% 0% 2% 4% 6% 8% 10% 12% 14% 16% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 GDP Growth Rates: China vs. United States China United States Source: World Bank
  • But is this coming to an end?
  • Thats what it looks like
  • Real estate sales in China are headed lower.
  • 77.60% -3.70% -10% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 2013 2014 Year-over-Year Change in Real Estate Sales: 2013 vs. 2014
  • Retail sales are growing at the slowest pace since feb. 2011.
  • 10.5% 11.0% 11.5% 12.0% 12.5% 13.0% 13.5% 14.0% Jan - Feb 2013 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan - Feb 2014 Year-over-Year Change in Retail Sales
  • Industrial output is increasing at the weakest pace since 2009.
  • 8.0% 8.5% 9.0% 9.5% 10.0% 10.5% 11.0% Jan - Feb 2013 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan - Feb 2014 Year-over-Year Change in Industrial Output
  • Fixed-income investments have eased to the lowest rate since 2002.
  • 17% 18% 19% 20% 21% 22% Jan - Feb 2013 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan - Feb 2014 Year-over-Year Change in Fixed-Income Investments
  • Chinese stocks are nearing 5-year lows.
  • 1,500 1,700 1,900 2,100 2,300 2,500 2,700 2,900 3,100 3,300 3,500 2009 2010 2011 2012 2013 2014 Shanghai Composite Index
  • Suffice it to say
  • This doesnt look promising.
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