Great piece about China’s coming bust by William Smead. He finishes the article with a bold prediction:


“Someday soon, as the charade of uninterrupted GDP growth catches up with the Communist government, we believe the entire Chinese banking system will have to be recapitalized to the tune of over $1.5 trillion. At that point, there won’t be enough money to lend for new projects to even maintain existing GDP levels. The high-speed train called China Economic Dominance will get knocked off the tracks. In our opinion, there will be an economic contraction in China lasting three to four years. Commodity prices will plummet and countries like the US, which have been punished by boom commodity prices during an anemic economic recovery, will flourish. Whether China is to become a truly great economy will be determined by what it does in the aftermath of the coming economic train wreck.”


Needless to say, I completely agree.


Full article here

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