Why China will never rule the world

Bloomberg is running an interesting study on what it will take for China to surpass the US economically in the decades ahead. It is much more difficult than Australia’s crop of CCP useful idiots would have you believe. Music to my ears:

If Xi delivers reform and Biden does not pass infrastructure stimulus then China could pass the US around 2030.
But neither of those is likely and reform failure, isolation and crisis is more probable for China.
Add China’s exaggerated GDP and demographic headwinds.
These variable deliver the following table of outcomes:

The downside scenario is the most likely, in my view. But I would add that GDP is exaggerated by 1-2% by the failure to write down bad investments so the underlying reality is worse.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.