China growth slows. Hah-hah!
Chinese GDP for the fourth quarter this morning registered growth of 8.9 percent (topping forecasts of 8.7 percent), lower than the overall year which grew at 9.2 percent. I remember at the beginning of the year, folks were happy with eight and a half percent. My most annoying one line of all time: “whatever!!”
What I did find quite interesting was the urbanisation trend, which is keeping up the blistering pace, the urban population clocked 51.3 percent of the population. I have to clutch my belly and laugh, people refer to the slowest growth in two and a half years, and this now giving policy makers scope to ease monetary policy. Now, there are problems and there are problems, and growth rates even HALF of this would be the envy of the developed world. No, let me rephrase that, growth rates of one third of that registered in China, even three percent would be the envy of the developed world.
The Chinese economy over the last decade (wait for it) has grown nearly fivefold.
The Chinese economy is 4.85 times bigger now than it was in 2001.
And 17 times bigger now than in 1991.
And 33 times bigger than in 1981.
Wow. There are a few spots that are causing the policy makers a few headaches, housing investment for the last month of last year dropped. Quite sharply. And the authorities have indicated that they are quite keen to move towards a consumption driven economy, we can see that is starting to shape up nicely. Sales just yesterday from Richemont suggest that the upper middle class is continuing to swell. And swell like the Scottish fellow in Austin Powers that Mike Myers portrays. That guy, you know who he is. Post the New Year Chinese celebrations (from the 23rd onwards for a week), I would expect a cut in the triple R. Not because I know anything, but because I suspect along with all other watchers, this is likely to happen.
Don’t care.
OK, not fair, do sort of care that the EFSF has been downgraded by S&P ratings agency from triple A to AA+, but why didn’t they just do all the downgrades together? Are they trying to see what their market mojo is? I have already heard a few market commentators say that they do not really see this as a big event at all. Oops. Meanwhile for the first time the ECB overnight deposit facility topped half a trillion Euros. The fund responded, I had a bit of a chuckle, check it out: EFSF statement following Standard & Poor’s decision to downgrade its long-term rating.
SASHA NARYSHKINE AT VESTACT