On the recommendation of a loyal reader, I just listened to Jing Ulrich talk about China’s economy over at China Money Podcast.  Ms. Ulrich heads up Global Markets at J.P. Morgan and I definitely put her on the very short list of those discussing China’s economy who actually know whereof they speak.

If you want an update on where China’s economy is today and where it is likely to be going in the future, I recommend you listen to this podcast.  If you want me to partially spoil it for you, read on.

In very brief summary, Ms. Ulrich noted the following:

  • China’s economy is rebounding, due at least in part to the government pumping large amounts of money into the system.
  • China real estate is in danger of overheating and so we should expect more government measures seeking to prevent this. Expect stricter enforcement of  existing laws and more cities rolling out a property tax.
  • Expect future infrastructure investment to focus on urban subways, light rail and the environment.

What do you think?

UPDATE:  While on the subject of China’s economy, just saw an excellent and informative interview of Michael Pettis by Tom Orlik (two people I put on the same “very short list” mentioned above — see my later post, entitled, Who To Read On China’s Economy?) over at China Real Time Report, entitled, “Eight Questions: Michael Pettis, ‘The Great Rebalancing.’”  Definitely well worth a read as well.

  • Michael_RightSite

    Hi Dan,

    Since the list is short, can you name some others who are worth listening to? (Granted that we all have our biases).



    • I know I will be leaving people off this list, but generally, it is those who actually have advanced degrees in economics and/or those who actually study/report on China’s economy who know the most. That should not be a surprise. And I want to stress that I do not necessarily agree with any of these people, but I do respect their analysis. Having said all this, here goes: Michael Pettis, Patrick Chovanac, Tom Orlick (who writes for the WSJ), Elias C. Grivoyannis. I am sure there are a lot more out there working at Universities or investment banks, but these are the ones who write a fair amount and with whom I am familiar. Would love to hear about more though.

  • dan berg

    If you agree (as I do) with Premier Wen that the Chinese economy is unbalanced, unstable and unsustainable, then Ms. Ulrich’s comments (with which I agree) are certainly bad news. As she correctly points out, this rebound is the result of a 2.54 Trillion (!) rmb stimulus, of which 1.07 T. is bank lending; the rest originates in the unregulated shadow banking system. Why? A good idea? How long can this continue? I think anyone with a pulse can predict how that particular movie will end. So far no sign or rebalancing, so this rebound contributes to the problem. Speed doesnt matter if you are going in the wrong direction. What will be the short-term ROI in subways, clean water and the environment? Chinese will be asked to repay this rising debt as the economy slows, personal demographic burdens rise and at a time when consumption is supposed to increase faster than GDP.