Latest Blog Entries

My blog is temporarily on hold. I am back in school studying machine learning and data science programming.

I will resume blog updates in late 2017.

The first batch of economic data in 2017 indicates that China has started the year on stable footing.  Investment modestly improved but remains in a decade’s low range.  Factory output is stable.  Consumption numbers were weaker on lower auto sales as government-backed incentives ended.  My models hint at early 2017 growth around 6.7 - 6.8%.  The obsolete “Li Keqiang” index - often cited as proof that the government was hiding a hard-landing a year and a half ago - is running around 10.5%, enough to keep many hard-landing doomsayers at bay for the time being.  China’s current economic state appears sound by most measures released so far this year.  

Economic stability has taken hold in spite of headwinds, but how much longer can those headwinds be contained?


A huge leadership shuffle is on its way in 2017.  Expect China's leadership to make all efforts to maintain stability - economic and social - in the coming year.  The use of all of Beijing's reflation tools are a potential detriment to long-term economic health, but can certainly be applied to keep the wheels on the rail in 2017.


China's Big Three Economic Indicators

(Select an area in a chart to zoom in. Double-click to zoom back out)

Speculation on what a Trump Presidency means for US/China trade relations is high.  Recent rhetoric from both sides suggests that at least some trade friction is on its way. Here is an analysis of what might be in store for the Chinese economy when Trump takes office next month.


China's house prices have cooled significantly.  The country's high savings rate and strict capital controls keep massive amounts of liquidity trapped in the country, frequently inflating and subsequently bursting asset bubbles.
That attribute often leads policymakers into cycles of pouring water on hot markets, or gasoline on crashing markets.  A cut in mortgage requirements and rates last year combined with a relaxing of some housing market restrictions set property prices on fire.  Over the last three months, nearly three dozen cities have inacted housing market restrictions, pouring water on the hot market to counter housing affordability issues.  
The real estate market is one of China's most important sectors.  The hot property market was a big reason for economic stability in 2016.  A downturn in property presents a high risk for near-term growth.

The China trade data page has been upgraded.  You can find the latest trade data by country, imports and exports by commodity type, and the full breakdown of China's trade sectors on the new page.  There are also some charts showing China's primary exports to the US, and the US primary exports to China.  



Credit and Investment Growth

(Select an area in a chart to zoom in. Double-click to zoom back out)

Credit growth is stable but slow. Industrial sector investment is weak. Private investment has lagged state-affiliated


Year-On-Year House Price Changes


PMI Data (select category on legend to see plot)