China is heading into an economic storm, and the much-feared hard-landing of the world’s second-largest economy has already started.
“The only way the Chinese government can continue to bail out everyone is to print more money, which will lead to inflation. But people are depositing money [in banks] at below inflation,” says Jim Chanos hedge-fund manager of Kynikos Associates on Monday.
“The numbers are falling faster than we thought,” “Real estate sales in September and October, which are peak months, fell 40%-60% on-year,” “People are buying into the idea of perpetual growth,” ‘Are you really growing?’”
Oct. 18, 2011
China’s economy grew in the third quarter at a slightly weaker pace than expected.
Third-quarter gross domestic product rose 9.1% from a year earlier, easing from the second quarter’s 9.5% gain, the National Bureau of Statistics reported.
The data comes amid fears that a slowdown in the US and Europe's debt crisis may also hurt China's growth.
“Growth has come in lower than market expectations, but we remain of the opinion that the Chinese economy continues to chug toward a soft landing, even as the risk of a hard landing is rising on account of weakness in advanced economies,” said IHS Global Insights China analyst Alistair Thornton in Beijing.
China has witnessed robust growth in past few years. But the rapid expansion has come at a price.
Consumer price inflation in the country has been above the central bank's target and there have been concerns of the formation of asset bubbles.
