Needlessly melodramatic headline. These are the details:
"Rich-world markets have regained some of their poise. But three fears remain: that China’s economy is in deep trouble...
Around $5 trillion has been wiped off global equity markets since the yuan devalued earlier this month. That shift, allied to a string of bad economic numbers and a botched official attempt to halt the slide in Chinese bourses, has fuelled fears that the world’s second-largest economy is heading for a hard landing. Exports have been falling. The stockmarket has lost more than 40% since peaking in June, a bigger drop than the dotcom bust.
Yet the doomsters go too far. [And with it, your fucking headline. Why do you use scare tactics like that?]The property market is far more important to China’s economy than the equity market is. Property fuels up to a quarter of GDP and its value underpins the banking system; in the past few months prices and transactions have both been healthier. China’s future lies with its shoppers, not its exporters, and services, incomes and consumption are resilient. If the worst happens, the central bank has plenty of room to loosen policy. After a cut in interest rates this week, the one-year rate still stands at 4.6%. The economy is slowing, but even 5% growth this year, the low end of reasonable estimates, would add more to world output than the 14% expansion China posted in 2007.
China is not in crisis. However, its ability to evolve smoothly from a command to a market economy is in question as never before...their botched—and sporadic—efforts to stop shares from sagging. Worse, plans for reform may fall victim to the government’s fear of giving markets free rein. [Botched, and still produced 5% annual growth.Some botch.]
"Rich-world markets have regained some of their poise. But three fears remain: that China’s economy is in deep trouble...
...
China, where share prices continued to plunge, is the source of the contagion...
Yet the doomsters go too far. [And with it, your fucking headline. Why do you use scare tactics like that?]The property market is far more important to China’s economy than the equity market is. Property fuels up to a quarter of GDP and its value underpins the banking system; in the past few months prices and transactions have both been healthier. China’s future lies with its shoppers, not its exporters, and services, incomes and consumption are resilient. If the worst happens, the central bank has plenty of room to loosen policy. After a cut in interest rates this week, the one-year rate still stands at 4.6%. The economy is slowing, but even 5% growth this year, the low end of reasonable estimates, would add more to world output than the 14% expansion China posted in 2007.
Even 5% growth the "low end." The U.S. would create a holiday for 5% economic growth. Obama would be drafted to run for a third term.
Okay, enough. Go away, doomsayers, and The Economist. And take down that irresponsible headline.
