I think that all the China skeptics are deeply wrong. Last week China´s stock market gained 2%, the stock index is up 22% year-to-date and climbed 92% in the recent 12 months. So what? The lamented crash (temporarely down 30%) is just a breather after a rally of 150%!
The claims about the faltering Chinese economy don´t stand reason as well. The recent data show that China´s economy is stabilizing and might even getting stronger. Last week we learned that China`s economy grew 7% in the second quarter, the same speed as in the quarter before (foxnews). In June industrial production grew 6.8%, faster than in May (plus 5.9%), and retail sales growth accelerated to plus 10.6% (May 10.1%). These is partly a response to reduced interest rates and other measures which are aming to rekindle economic growth. China is also benefitting from the sharp fall of oil and other commodity prices.
I believe that China will continue its exceptional growth thanks to a fundamental reform program, iniated in 2013, including huge investments
railways and other infrastructure. China is still in the begin of a secular catching-up process which is
fueled by extreme income & wealth differences to the US and other
Western nation values. The huge country is rapidly transforming into a
consumer economy like the U.S. and other modern countries (driveby). China will beome even more important as the growth engine of the world and Shanghai´s stock market will resume the rally.
But American banks and hedge funds - influenced by notorious China bashers like Jim Chanos and Paul Krugman (driveby) - are betting against the country, making a lot of noise to spoil the sentiment on the financial markets. I suppose that the continous China bashing is part of an old anti-Chinese attitude. The facts - and reason - stand against those speculators. I suppose that the China crash callers are on the losing side.