Tag Archives: eisenberg and graphs and graphsandlaughs

Financial Repression

While the Chinese government must rebalance its economy away from export and investment-led growth towards household consumption-led growth, the problem is that the combination of low wages, low interest rates on savings and an undervalued currency all conspire to keep the household share of Chinese GDP spectacularly low, constraining household spending. Reversing all these policies will be difficult, and thus Chinese growth rates are sure to continue slowing.