China’s Growth Slows
Moving from Europe to China, the story stays similar. While Europe is in recession, China’s growth has slowed dramatically. This is another prediction that has already begun to come true since we first made the prediction. However, we see this trend continuing.
China’s economy is largely based on sending cheap manufactured items to the US and Europe. Both of these areas are not seeing the growth necessary to drive increased sales. Thus, China’s suffering with the rest of the world.
Because China’s still in the emerging part of it’s growth cycle and generally sees very large growth rate, we’re not necessarily predicting a recession as the US and Europe are familiar with. We’re looking for something more along the lines of 3-6% economic growth. What needs to be understood though is that that is not enough growth to keep the people happy.
Millions of Chinese people are constantly migrating from the fields into the cities looking for jobs. The communist party that controls the government has to deliver high growth and reasonable food prices in order to not get thrown out of office via pitchfork.
Our guess is that sort of change will come to China within the next few years. For this year, we’re only predicting that China’s growth will continue to decelerate and be far from what the entire world hopes they will deliver to save the world economy.
This is the 24th post in a series. You should read the initial thoughts on these forecasts here. and the Overall Prediction Page here. Here are the rest of the posts: 3) Ben Bernanke’s Dollar Devaluation Plan, 4) The Coming US Dollar Devaluation, 5) Stock Market Volatility, & 6) Stocks to Fall in 2012, 7) The European Crises, & European Options, 9) European Prediction, 10) Recession in Japan, 11) Japanese Yen Crash,12) War with Iran, 13) Jewish Perspective on Iran, 14) Commodities to End 2012 Lower, 15) Where Will Gold Go Next?, 16) Gold, Should you Wait?, 17) Will Silver Move Higher?, & 18) Why Buy Silver Now?, 19) Oil Prices to Explode Higher, 20) Bonds Will Fall, 21) US Dollar, 22) European Recession, 23) Sovereign Default in Europe, 24) China’s Slowing, & 25) US Recession.