Who Believes China’s ‘Bernie Madoff’ Data?

I don’t want to spend too much time on this, but I have to laugh every quarter when we get economic data out of China.

China’s economy expanded at the fastest pace in a year as stimulus spending and record lending growth helped the nation lead the world out of recession. Gross domestic product rose 8.9 percent in the third quarter from a year earlier, the statistics bureau said in Beijing today. The median of 34 estimates in a Bloomberg News survey was for a 9 percent gain. Separate reports showed industrial production and retail sales accelerated in September.

The dollar headed higher and Asian stocks dropped on concern that the acceleration in China’s growth will spur policy makers to consider withdrawing record fiscal and monetary stimulus in coming quarters. Qin Xiao, chairman of China Merchants Bank Co., this week said it’s “urgent” for the central bank to tighten policy to avert asset-price bubbles.

I look askance at the US economic data — skewed, massaged, modeled to within an inch of its life. But its mostly transparent, with the statisticians readily available for further discussion.

The Chinese data looks to me as if it is issued by edict — they are non-transparent, well managed, and remarkably consistent over time.

I wonder if Beijing’s accountant is an 80-year-old with offices in New City and Florida . . .


China’s Economy Grows 8.9%, Fastest Pace in a Year
Kevin Hamlin; Li Yanping
Bloomberg, Oct. 22 2009

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