Has China reached it’s peak? 3


Good day forex traders.


You have had your say and the results are as follows.

On the opinion if China has reached it’s economic peak :


56% voted No

44% voted Yes
Now this is a small difference in percentage and perhaps not without it’s reason. To many, China’s fast ascension to the world economic stage was a period of great opportunity. In the later part of the 20th century, China saw the need to revolutionize it’s economy. The government concentrated on

China Growth

setting up the necessary infrastructure and sought to attract foreign investments, talents and expertise to set things in motion. Fast forward to the early 21th century, growth rate is slowing. The 2008 financial crisis and the current Euro Zone budget deficit crisis highlighted the increasing drag on the growth of the economy. If growth is indeed falling, the logical conclusion will be an eventual hail.

That is if policies remain status-quot.

The economy of China has grown and stretched itself a long way. Having said so, rural communities remain poor. Domestic issues and consumption took a back seat due to the priority of growth and ascension in the global economic arena.

Fortunately, this developing crack is apparently recognized by the government of China and steps are taken to rectify it. The Chinese government recognizes the fact that an economy reliant on international consumption leaves the country extremely vulnerable to the events of other countries economies.

Christine Lagarde of the IMF mentioned that China needs to be less reliant on exports and investment back in March.

China has an important task ahead. In a time whereby economic challenges are aplenty, it needs to quickly focus on it’s internal economic machinery. The splendid growth of the early years has come and gone by. In a time where countries struggle with their domestic economies, China is well posed to reap the economic strength it has gathered and expand growth domestically. If China takes the right step, the peak perhaps has yet to come.


Thank you readers for your time and why not head out to vote for the new Have Your Say ! poll?

Do you think a new financial crisis has hit us ?

The EUR/USD has fallen a fair bit. Worldwide, equities retreat from their top. Do you think a new financial crisis has hit us?

Have your say at the home page!

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  • Do head out to the home page to vote for the new poll ok?  BTW dear readers, we need your support.. do link to us if you have a website / blog too 🙂

  • Hardjaya

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  • No
    I do not think a new crisis has hit us. I think the whole financial crisis
    comes in three parts. The first part was the crisis in America which
    saw the collapse of Lehman Brothers, Bears Stern, and Merrill Lynch. The second
    part is in Europe which has seen the Private
    Sector Involvement which resulted in the write down of Greek bonds. Whilst
    Europe is going to suffer a lost decade, Portugal. Italy, Ireland,
    and Spain
    are going to pull through (just). There will be QE3 which will accelerate the
    decline of the unemployment levels in the US. The third part will take
    place in Asia and possibly will have the most
    serious consequences. The China
    economy is going to go into melt down. It will be bought about by a lack of
    audit. What will happen is banks will have lent way beyond what any level of
    reserves could possibly cope with (excessive fractional banking). Regional
    governments plus many industries including in particular the railways will be
    defaulting on loans from banks that are revealed as being many time bigger than
    previously disclosed. This will compound the banking problem. Initially China will repatriate
    its overseas investment and in particular its Dollar investments which will
    hurt the Dollar send EUR/USD to the 2.0000 level. Eventually the Yuan will be
    wiped out by successive devaluations. China will introduce the New Yuan
    and this will be the conclusion of the financial crisis that started with the
    American subprime failure in 2008. It will take another three or four years to
    work through. The main thing is that Dr Ben Bernanke would have saved America from a
    second Great Depression. I hope history will remember him for that.