The economic woes and faltering exchange traded funds (ETFs) of China may spill over to the new year as politically and socially sensitive anniversaries presage misfortune. But rest assured, China does have a plan.
The high levels of yesteryear’s economic growth is now shrinking and the Communist Party is having difficulties in placating the masses, according to the Economist. As IMF predicts Chinese GDP of 5%-6% and the World Bank estimates 7.5% for the next year, the main pillar of support for the Communist Party, the new middle class, is becoming dejected by official calculations of 8% being the minimum level of growth needed for stable employment.
China is looking at uncertainties that thwart its economic and social welfare such as the resilience of its political system to the current market stresses and how Chinese consumers will respond to the crisis. By keeping the middle class spending and happy, the Chinese economy should be relatively gratified.
Then there are the pending politically sensitive anniversaries in the coming months that will serve as a focal point for the party’s shortcomings to the already unsatisfied citizenry.