The Chinese economy is slowing rapidly. The latest estimates show declines of several percent in official Chinese growth rates, which might be indicative of an actual recession. The Chinese government, like many around the world, is responding with a large economic stimulus plan. Official estimates are that the plan will cost roughly 14 percent of one year of China’s GDP, or well more than double the relative size of the proposed plan in the U.S. While some of the proposed stimulus spending may be worth doing anyway, the idea of a stimulus plan is to spend and build more than is worth doing in an economic slowdown. In the rush to stimulate the economy, there will surely be some waste and investments undertaken that in retrospect may be worthless.
Archive for the ‘China’ Category
- RT @GrupoGuayacan: Professor @yaelhochberg talks about creating a risk capital industry and the role of different sectors in the ecosystem.… 9 hours ago
- RT @themadstone: The only winner tonight is the Voyager probe, which is speeding away from the Earth at 17 kilometers/second #debatenight 3 days ago
- AIG amusing diversions bailout bank regulation Bernanke CDS derivatives Dodd-Frank Act Euro Debt Crisis FDIC Fed Finance & the Public Interest financial crisis Financial Crisis Inquiry Commission financial reform Goldman Sachs GSEs Lehman Brothers MBS mortgages pensions public finance recession regulation SEC securitization TARP too big to fail Treasury Uncategorized