China’s Huge Economy Perhaps Not as Solid as it Seems

China now has the world’s second largest economy, but its GDP girth may not directly translate into as solid a market as one might guess. In the video below, Stratfor points out that China, despite impressive growth rates, is both export heavy and consistently dependent on razor-thin margins that can easily turn negative. This leaves the nation on a more precarious footing than developed countries with domestically-oriented economies. Until China makes that transition, Stratfor argues, it’ll have a tough time eliminating the persistent threat of social unrest in order to become a sustainable economic powerhouse.

This clip came to our attention via a post on The Big Picture covering China’s GDP and questioning its strength.

The Daily Reckoning