OECD China Forecasts

Ghost City

OECD: China will be Largest Economy Around 2016 | Pacific Money.

I have two words to dispel the misconception that China will overtake the U.S. as the world’s largest economy in 2016: Ghost Cities.

Much of China’s economic growth for the past few years has occurred because the new middle class has been investing its savings in these ghost cities.  Once the middle class stops investing in this non-income producing real estate, there will be a crash, and China will experience a nasty recession just like all other economies experiencing a property bubble.

China may indeed pass the U.S. and seize the title of the world’s largest economy, but push that date back just a few years.

Advertisements

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s