China’s Two Choices: Crisis or Stagnation

China’s Two Choices: Crisis or Stagnation
A worker cleaning a diesel engine part in Qingdao, China, Aug. 29, 2017. China's economy has been strong recently but Daniel Lacalle argues there will be a price to pay. STR/AFP/Getty Images
Daniel Lacalle
Updated:

China’s third-quarter GDP growth of 6.8 percent was suspiciously in line with the government mandate and most analyst estimates. But when growth is no concern, debt saturation and diminishing returns of the central-planning model are.

Chinese total debt has surpassed 300 percent in 2017. The money supply keeps increasing at close to double-digit rates, or 9.2 percent, compared to last year in August.
Daniel Lacalle
Daniel Lacalle
Author
Daniel Lacalle, Ph.D., is chief economist at hedge fund Tressis and author of the bestselling books “Freedom or Equality” (2020), “Escape from the Central Bank Trap” (2017), “The Energy World Is Flat”​ (2015), and “Life in the Financial Markets.”
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