From Willem Buiter, one of the world’s most sensible market economists via Bloomie:
“It’s an economy that’s sliding into recession.”
Premier Li Keqiang is seeking to defend a 7 percent economic growth goal at a time when concern over slowing demand in China is fueling volatility in global markets. The true rate of expansion “is probably something closer to 4.5 percent or less,” Buiter said.
“They will respond but they will respond too late to avoid a recession, which is likely to drag the global economy with it down to a global growth rate below 2 percent — which is in my definition a global recession,” said Buiter.
Even worse, and probably right, Buiter is calling for consumer not investment focused stimulus.
What is good for China is now disastrous for Australia.
