Beijing is feeling generous again. After a few months of slowing growth, poor economic data and signs of stress in the banking system, China’s top leaders will toss the economy a bone. The government has wrapped up a boutique stimulus basket that will target railways and affordable housing. (Sorry, the package won’t be denominated in bitcoins.)
With no lack of largesse, they’re even forking out redbacks to the World Bank’s poverty collection, the fund that puts the ‘fun’ back in fund. The Party has asked cadres to donate their Prada bags to charity, something that unfortunately won’t generate new sales for the luxury brand. They’ve also been asked to give up first-class plane tickets in the name of humility although sources say that members are loath to travel without caviar and Prosecco.
CER thinks China is doing just fine, no need to overdo the stimulus spending. Sure, a few companies have defaulted, and investors are so anxious that they’re buying up digital housing in far away lands. But state-backed-military-related firms are thriving these days. In places like Guangzhou and Shenzhen, the community has really rallied around new ambitious projects. There’s a general sense of well being sweeping through the country like a nitrous oxide leak (mining magnate-cum mafia bosses and former top generals excluded).
If there is indeed an economic meltdown in the offing, this magazine recommends slipping into a stupor for longer than usual. Down a frothy glass of USDA-approved milk, snuggle into a GE-made baby warmer – Vicodin drip intravenous – and expect to wake to promising GDP figures in the third quarter of the year. Success is almost guaranteed.