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  1. #1
    Senior Member
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    Jan 2013
    Auckland, New Zealand
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    Default Chinese GDP Contracts Again

    China reported GDP of 7.5% which marks the second consecutive contraction for the world’s third largest economy. Despite the contraction, market participants took it in stride. I do applaud the Chinese for not succumbing to market pressures who want the Chinese government to unleash an idiotic stimulus package like The Septic tank did in the U.S.

    The Chinese government understands that the key to a strong economy is sustainability and not to patch up the economy and lift it artificially while hoping for a positive outcome. Sure, China did stimulate the economy at times and as they felt necessary and not as markets wanted them to.

    Another great difference is that when China stimulates the economy they do so with a budget surplus and do not have to borrow from future growth and generations while the Septic Tank just loaded a $2 Trillion of debt to the Fed’s balance sheet.
    When it comes to monetary decisions and fiscal policy I think China is doing the right thing and sets an example for the butt-monkeys in the U.S. Fed, over at the much hated Bank of Japan and right into the heart of the EU in Frankfurt.

  2. #2
    Senior Member
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    Nov 2012
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    Thanks for this information. Very informative post.

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