Apres la deluge: China in the credit crisis aftermath

During the past month of financial storms we have so far held back from giving a comprehensive view of the outlook for China. Our hesitation reflects in part a degree of uncertainty about domestic conditions, and in part a more serious uncertainty about just how bad the global economy was going to get. The larger problem, however, was that the current crisis raises broad issues about the structure of the global economy, and China’s relationship with it, that are likely to be played out over the next decade, not just the next 18-24 months. We wanted to be sure that we had a conceptual framework that will enable our readers to position themselves properly both for the short and the long term. Today’s note attempts to sketch out that framework, which we hope will enable readers to apply the appropriate discount to the breathless headlines coming out from China. Additional notes over the next few weeks will fill in some of the technical details.
Source: GaveKalDragonomics China Insight, 15.10.08