Gloom, Dr. Doom and Maybe No More Boom

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Here’s a link to the latest paper on China’s economy by Nouriel Roubini of Columbia University, aka Dr. Doom. As I wrote a while back, some of his analysis of the Chinese economy seemed to be done from so far away that he missed some of the factors that genuinely do make it different fromits ¬†fully capitalist brethren. This time he wrote a few days after returning from a trip to china and his analysis is much better informed. It is also, not surpisingly given his nickname, not exactly full of optimism. I am in the midst of writing a piece about the prospects for the Chinese economy, which is widely seen now as having bottomed out and perhaps beginning a bounce back on the back of the massivce credit loosening undertaken by the central bank and other government measures. Some economists think though that this is a false dawn and that China could be headed for a “W” shaped recession, down, up, then back down again as the lack of external demand bites once more and no clarity about when the last up might come. As one particularly gloomy economist said to me: “There’s no letter in the alphabet that could be used to describe where I think the Chinese economy is going.” Scary stuff.