Would communists lie about their economic stats? Naaah.
China GDP Statistics
Econbrowser blog
More and more people are concluding that those unbelievable China GDP statistics are, well, unbelievable.
Source: Simon World chinastats.jpg
Barry Ritholtz writes:
If you think I am skeptical about the BLS data, imagine how I feel about this nonsense from the Red Communists of China's Central Economic Planning Bureau. (Those guys make the BLS look like Capitalists).
Brad Setser says he's right, and Simon World has the goods. Consider Simon's graphs at the right. The first shows the levels of various Chinese GDP components, which might look reasonable at first blush. But when you subtract investment, net exports, and government spending from GDP, you arrive at what should be the sum of consumption spending plus inventory investment, represented by the magenta curve (which Simon helps the color-vocabulary-challenged to identify as "the line in the ugly colour"). Trouble is, this ugly magenta line clearly trends down, and that can't remotely be explained by inventories. The implausible behavior is even more clear when plotted as growth rates as the red line in the second graph. Simon explains the significance:
It seems from this that in the year to September the man on the street spent 17 per cent less on daily necessities and toys than he did the previous year. But this is not what other official statistics say. They say that retail spending for the year to September was 13.6 per cent greater than it was the previous year (the blue line) and that this retail spending alone was almost twice as great as the remainder number we calculated for all personal consumption spending.
How is it possible? It is not. The latest GDP figures from the mainland simply do not add up.
And then we could talk about those China FDI statistics...
"Market Communism" is the most obnoxious oxymoron since "original sin." And those who get duped by the fraud, or who just don't care so long as China keeps building "neat-o" skycrapers, are running out of excuses for their increasingly inexcusable perspective.
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