We mentioned a possible divergence of opinion between Niall Ferguson and Jim Chanos on the future of China's economic path in Monday's post, "Niall Ferguson: world tilts towards Asia" (although Niall does hedge quite a bit on possible outcomes for Asia & China towards the final paragraphs of his article).
Is China's economy sailing along thanks to a skillful implementation of government-directed "stimulus", or is the country's current prosperity and stated economic output merely a mirage?
Jim Chanos is on record saying that China is "Dubai times 1000" and that the government-directed economy is being propped up with phony GDP statistics. His firm, Kynikos Associates, has also been influenced by a report on China's economy from Pivot Capital Management:
"The Pivot Capital report was extremely popular in Chanos’s office and concluded, “We believe the coming slowdown in China has the potential to be a similar watershed event for world markets as the reversal of the U.S. subprime and housing boom.” "
I thought it would be insightful to follow-up Monday's post with a look at this research, so I'm currently reading Pivot Capital's report, "China's Investment Boom: the Great Leap into the Unknown" (pdf).
If you're inclined to read along and share your thoughts on China's economy with us, we'd appreciate it.
Is China's economy sailing along thanks to a skillful implementation of government-directed "stimulus", or is the country's current prosperity and stated economic output merely a mirage?
Jim Chanos is on record saying that China is "Dubai times 1000" and that the government-directed economy is being propped up with phony GDP statistics. His firm, Kynikos Associates, has also been influenced by a report on China's economy from Pivot Capital Management:
"The Pivot Capital report was extremely popular in Chanos’s office and concluded, “We believe the coming slowdown in China has the potential to be a similar watershed event for world markets as the reversal of the U.S. subprime and housing boom.” "
I thought it would be insightful to follow-up Monday's post with a look at this research, so I'm currently reading Pivot Capital's report, "China's Investment Boom: the Great Leap into the Unknown" (pdf).
If you're inclined to read along and share your thoughts on China's economy with us, we'd appreciate it.