Best of the Week
Most Popular
1. Gold Final Warning: Here Are the Stunning Implications of Plunging Gold Price - P_Radomski_CFA
2.Fed Balance Sheet QE4EVER - Stock Market Trend Forecast Analysis - Nadeem_Walayat
3.UK House Prices, Immigration, and Population Growth Mega Trend Forecast - Part1 - Nadeem_Walayat
4.Gold and Silver Precious Metals Pot Pourri - Rambus_Chartology
5.The Exponential Stocks Bull Market - Nadeem_Walayat
6.Yield Curve Inversion and the Stock Market 2019 - Nadeem_Walayat
7.America's 30 Blocks of Holes - James_Quinn
8.US Presidential Cycle and Stock Market Trend 2019 - Nadeem_Walayat
9.Dear Stocks Bull Market: Happy 10 Year Anniversary! - Troy_Bombardia
10.Britain's Demographic Time Bomb Has Gone Off! - Nadeem_Walayat
Last 7 days
Stock Market Pause Should Extend - 21st April 19
Why Gold Has Been the Second Best Asset Class for the Last 20 Years - 21st April 19
Could Taxing the Rich Solve Income Inequality? - 21st April 19
Stock Market Euphoria Stunts Gold - 20th April 19
Is Political Partisanship Killing America? - 20th April 19
Trump - They Were All Lying - 20th April 19
The Global Economy Looks Disturbingly Like Japan Before Its “Lost Decade” - 19th April 19
Growing Bird of Paradise Strelitzia Plants, Pruning and Flower Guide Over 4 Years - 19th April 19
S&P 500’s Downward Reversal or Just Profit-Taking Action? - 18th April 19
US Stock Markets Setting Up For Increased Volatility - 18th April 19
Intel Corporation (INTC) Bullish Structure Favors More Upside - 18th April 19
Low New Zealand Inflation Rate Increases Chance of a Rate Cut - 18th April 19
Online Grocery Shopping Will Go Mainstream as Soon as This Year - 17th April 19
America Dancing On The Crumbling Precipice - 17th April 19
Watch The Financial Sector For The Next Stock Market Topping Pattern - 17th April 19
How Central Bank Gold Buying is Undermining the US Dollar - 17th April 19
Income-Generating Business - 17th April 19
INSOMNIA 64 Birmingham NEC Car Parking Info - 17th April 19
Trump May Regret His Fed Takeover Attempt - 16th April 19
Downside Risk in Gold & Gold Stocks - 16th April 19
Stock Market Melt-Up or Roll Over?…A Look At Two Scenarios - 16th April 19
Is the Stock Market Making a Head and Shoulders Topping Pattern? - 16th April 19
Will Powell’s Dovish Turn Support Gold? - 15th April 19
If History Is Any Indication, Stocks Should Rally Until the Fall of 2020 - 15th April 19
Stocks Get Closer to Last Year’s Record High - 15th April 19
Oil Price May Be Setup For A Move Back to $50 - 15th April 19
Stock Market Ready For A Pause! - 15th April 19
Shopping for Bargain Souvenirs in Fethiye Tuesday Market - Turkey Holidays 2019 - 15th April 19
From US-Sino Talks to New Trade Wars, Weakening Global Economic Prospects - 14th April 19
Stock Market Indexes Race For The New All-Time High - 14th April 19
Why Gold Price Will “Just Explode… in the Blink of an Eye” - 14th April 19

Market Oracle FREE Newsletter

Top 10 AI Stocks Investing to Profit from the Machine Intelligence Mega-trend

China: This Is Your Time!

Economics / China Economy Mar 08, 2013 - 06:55 PM GMT

By: Profit_Confidential

Economics

George Leong writes: The time has arrived for China. For the country, this will be a critical moment in its continued development as a global power, with a change at the helm under its new President Xi Jinping and Premier Li Keqiang. China is currently facing a potential property bubble, and it’s dealing with stalled growth from the eurozone as well as other key trading partners. (Read “Why Eurozone’s Problems Are Headed for America.”)


The new leaders will bring some youth to the leadership and generate fresh ideas for how China will be over the next decade, including increasing personal income levels and consumer spending to help lessen the dependence on foreign investment and exports. The country has targeted a modest gross domestic product (GDP) growth rate of 7.5% for 2013 and wants consumer spending to become more of a factor, as is the case in the United States and other industrialized countries.

In my view, it makes sense. As China becomes more powerful economically, a growing issue has been its massive trade surpluses, and this has not been well received by its major trading partners who are citing unfair advantage and currency manipulation. China understands this, which is the reason why the country wants to shift its GDP growth strategy to focus on raising domestic consumption.

I think there will be more exciting times ahead for the country and its citizens if things pan out under the country’s new leadership. The next decade could be special for China, but Xi Jinping and Li Keqiang must work to avert an asset bubble and economic stalling.

China’s GDP growth is estimated to expand at 8.5% in 2013, down from the previous 9.3% estimate, according to the Organization for Economic Cooperation and Development. (Source: “OECD Cuts China GDP Forecast, Sees Policy Room to Back Growth,” MNI November 27, 2012, last accessed March 6, 2013.) Of course, there’s still the risk and uncertainty, as the country’s economic recovery will continue to be dependent on what happens in the eurozone over the next few years.

If the country can increase income levels and get consumers to spend, then there will obviously be less reliance on foreign demand; but the shift could take a decade. Yet, supporting this shift are 1.3 billion people, a surging middle class, higher income levels, and a concerted government move to drive China’s economic turbines to expand the country’s power.

Unlike the United States, China has ample cash reserves of over $3.0 trillion that it can use to pump up the economy, which is a key reason why I remain positive on China. The outgoing government indicated it will spend a record amount to stabilize and drive the economy.

It will not be easy, given the size of the country, but if the country’s new leaders can achieve its goals over the next decade, then I would expect more great things to come from China.

The bottom line is: I continue to like China longer-term. There is no doubt in my mind that the country could become a more influential and powerful country economically.

Source: http://www.profitconfidential.com/stock-market/china-this-is-your-time/

George Leong, B.Comm.

http://www.profitconfidential.com

We publish Profit Confidential daily for our Lombardi Financial customers because we believe many of those reporting today’s financial news simply don’t know what they are telling you! Reporters are trained to tell you the news—not what it can mean for you! What you read in the popular news services, be it the daily newspapers, on the internet or TV, is the news from a “reporter’s opinion.” And there’s the big difference.

With Profit Confidential you are receiving the news with the opinions, commentaries and interpretations of seasoned financial analysts and economists. We analyze the actions of the stock market, precious metals, interest rates, real estate and other investments so we can tell you what we believe today’s financial news will mean for you tomorrow!

© 2013 Copyright Profit Confidential - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules