Man Made Chinese GDP

I've said GDP is a garbage data point and none more so than China's GDP. As of the latest GDP report, it is very clear that either economic analysts are out to lunch, or China is massaging the headline GDP number.

In September, real estate investment fell to 8.6% yoy. Fixed asset investment fell to 11.5%.

In July, I posted Do Or Die Time For China's Real Estate Market. I mentioned a couple of analyst calls on Chinese GDP.
[Soc Gen] In summary, we think that real estate investment growth will continue to trend lower, likely to the level of 5% yoy (from 12.5% in June), a level last seen during the 2009 downturn. The IMF once estimated that a 1% decline in China’s real estate investment would shave about 0.1% off China’s real GDP within the first year. And so a 7.5ppt deceleration in real estate investment growth would drag down GDP growth by about 0.75ppt.
That decline is halfway finished and there's been barely a drag on GDP. If there's any truth to this estimate, GDP is set to tumble in Q4.

Then there's the Shenyin Wanguo analyst who predicted GDP would slip to 6.6% growth if real estate investment fell below 14%.

Every economy in the world is driven by investment, but none more so than China. Investment growth rates are collapsing and there's seemingly little to no impact on GDP. At current rates of deceleration, real estate investment growth could be down to 5% by the end of the year, but GDP hasn't even really budged yet. Either the models are wrong or 2014 GDP growth is already looking to be in the range of 6% to 6.5%, assuming everything goes well and there's no financial crisis or external hit to global trade.

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