What goes up must come down

Posted by Scriptaty | 6:10 AM

While Chinese growth continues to plow ahead, economists note the longer it continues at this frenzied pace, the greater the risks become of a more extreme meltdown.

“Recent growth has confounded expectations,” Buskas says. “The longer China expands at this blistering pace, the higher the risk that it comes crashing down.”

Buskas adds that the downside risks outweigh the upside risks for Chinese growth.

“They can’t afford to grow at 9, 10, 11 percent,” Goldstein adds. “It is in their interest to gradually cool off to 7 to 8 percent. However, it’s awfully hard to hit the brake without hitting it too hard.”

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