Even More Evidence of a China Hard Landing
Incredibly the “sistema” is being pulled out round the clock to circle the wagons explaining how China is just fine. The truth is that China has been in steady deterioration for over a year. The problem with China lies in its overcapacity, which so severe that a mere “slow down” is not possible. Since fixed asset investment is far more than this economy needs, when this falls it falls big, which is exactly what is happening. Do the following charts look like a soft landing 7% GDP growth scenario to a thinking person?
The myth is that the Chinese consumer can pick up the slack. Cement and steel production would be a function of housing construction activity and local vanity projects.