There has been a significant focus on 7.5% growth in China. The commodity markets have sold-off based on the 7.5% solution form the Chinese government. There is also the fear that if China does not hit the 7.5% growth solution there will be a significant sell-off in global markets.
After hearing about the 7.5% solution from China enough times, the number started to stick in my mind and have me harken to the book, The Seven Percent Solution by Nicholas Meyer. The book's main character, Sherlock Holmes, has a cocaine addition which he must get over to return to his former self. The global economy may be addicted to high China growth and a seven percent solution is not going to get markets over the current malaise.
The China growth focus will be a recurring story for investors and may be as important as the trend line problem with US growth.
No comments:
Post a Comment