5 reasons to worry about china's economy

20
Reasons to Worry 5 about China’s ECONOMY

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New data released by the Chinese government suggests that its real estate bubble may have popped and its economy is feeling the effects.

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Page 1: 5 Reasons to Worry about China's Economy

Reasons to Worry5about China’sECONOMY

Page 2: 5 Reasons to Worry about China's Economy

Since the financial crisis, China hasserved as the engine of the global economy.

Page 3: 5 Reasons to Worry about China's Economy

While the United States & Europeremain mired in economic malaise…

Page 4: 5 Reasons to Worry about China's Economy

…China’s miraculous ascent has continued.

Page 5: 5 Reasons to Worry about China's Economy

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

-4%-2%0%2%4%6%8%

10%12%14%16%

GDP Growth Rates: China vs. United States

China United States

Source: World Bank

Page 6: 5 Reasons to Worry about China's Economy

But is this coming to an end?

Page 7: 5 Reasons to Worry about China's Economy

That’s what it looks like…

Page 8: 5 Reasons to Worry about China's Economy

1Real estate sales in China are headed lower.

Page 9: 5 Reasons to Worry about China's Economy

2013 2014-10%0%

10%20%30%40%50%60%70%80%90% 77.60%

-3.70%

Year-over-Year Change in Real Estate Sales: 2013 vs. 2014

Page 10: 5 Reasons to Worry about China's Economy

2Retail sales are growing at the slowest pace since feb. 2011.

Page 11: 5 Reasons to Worry about China's Economy

Jan - Feb

2013

Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan - Feb

2014

10.5%

11.0%

11.5%

12.0%

12.5%

13.0%

13.5%

14.0%

Year-over-Year Change in Retail Sales

Page 12: 5 Reasons to Worry about China's Economy

3Industrial output is increasing at the weakest pace since 2009.

Page 13: 5 Reasons to Worry about China's Economy

Jan - Feb 2013

Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan - Feb 2014

8.0%

8.5%

9.0%

9.5%

10.0%

10.5%

11.0%

Year-over-Year Change in Industrial Output

Page 14: 5 Reasons to Worry about China's Economy

4Fixed-income investments have eased to the lowest rate since 2002.

Page 15: 5 Reasons to Worry about China's Economy

Jan - Feb 2013

Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan - Feb 2014

17%

18%

19%

20%

21%

22%

Year-over-Year Change in Fixed-Income Investments

Page 16: 5 Reasons to Worry about China's Economy

5Chinese stocks are nearing 5-year lows.

Page 17: 5 Reasons to Worry about China's Economy

2009 2010 2011 2012 2013 20141,500

1,700

1,900

2,100

2,300

2,500

2,700

2,900

3,100

3,300

3,500

Shanghai Composite Index

Page 18: 5 Reasons to Worry about China's Economy

Suffice it to say…

Page 19: 5 Reasons to Worry about China's Economy

This doesn’t look promising.

Page 20: 5 Reasons to Worry about China's Economy

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