Friday, November 7, 2008

The Bubble is Bursting

China's decade-long economic hey-day is most likely over.

From The New York Times:

SHANGHAI — Each new forecast of China’s economic fortunes predicts slower growth than the forecast that preceded it.

Just as China attained supercharged growth that astounded much of the world, it appears to be slowing more sharply and more quickly than anyone anticipated.

“It’s tough to be optimistic,” said Stephen Green, an economist at Standard Chartered Bank in Shanghai. “The three engines of growth — exports, investment and consumption — have all slowed down.”

The signs are so troubling that last week Prime Minister Wen Jiabao warned that this year would be “the worst in recent years for our economic development.”

A series of government reports released over the last few weeks indicated that China’s export juggernaut was moderating. Real estate construction projects are being suspended. Consumer confidence is in decline. And many factories in southern China are closing, putting tens of thousands of migrant laborers out of work.

Read On

It'd be foolish to think that any country is going to get out of the current economic crisis unscathed. In a globalized world, we're all in it together.

Whenever I tell people outside of China that I'm learning Chinese, they often remark that I'll be able to make a lot of money one day with this skill. With China's recent economic growth over the past several years, I see where they're coming from.

Maybe it's true that I'll be able to take advantage financially of the hard work I'm putting into learning Chinese one day. But given the current state of the world economy, I wouldn't say that this is by any means a certain thing.

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