China's economy is no doubt experiencing a slowdown. As much as it has been suspected that the second largest economy's official statistics are fudged to look more favorable, things are getting to the point that it could not be hidden that growth is at a 13-year low.
What does this mean? The way I see it, our problems go beyond scams perpetrated in the US and Europe. Their problems are not isolated or region-specific. And just as the West started showing signs of a slowdown about five years back, China is going through the same thing, and is going to see worse things a few years down the road. And for much the same reason: credit expanded beyond actual savings, creating booms in the short term and busts later on.
The Telegraph article sees an uptick for China this coming 2013, and indeed, there is some genuine growth going on in the country. But this has to do more with actual savings, and not loose lending. And perhaps things have not become so bad yet in China for a currency crisis and an outright depression to occur. But whether it's five years or 20 years later, nothing good can be accomplished by maintaining the status quo of below-market-cheap credit.
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