We’ve been saying the numbers weren’t to be trusted in China for years. (We certainly weren’t the only ones.) Looks like the world is also coming to this realization, or more likely is just acknowledging that the jig is up. Or maybe both. Whatever, we hope that you had a good ride if you were investing in China on the long side, and hope that you saw the writing on the ghost city walls before things got ugly.
This video from 60 Minutes circa 2013 is probably worth watching again.
In July, when China reported its economy grew at 7 percent in the second quarter, slightly ahead of expectations, there were economists who questioned the number at the time. But today we know the depth of the distrust in the numbers.
According to a Wall Street Journal survey more than 96 percent of economists surveyed say they don’t believe China’s economic statistics don’t accurately reflect reality, but paint a political picture. “Official data are manufactured to fit the government’s narrative,” Stephen Stanley, chief economist at Amherst Pierpont Securities, was quoted as saying in a Journal article on the study.