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        • China lacks innovation? Take another look
        • A Copernican Revolution in Western economics & China’s supply side reform
        • Why Chinese neo-liberals are forced to falsify world history
        • Why China won't suffer a Western type financial crisis
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        • A damaging confusion in Western economics books
        • To become a high income economy China needs to study facts not myths
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        • The most important book on economic growth to have appeared for many years
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      • Economic data shows claim of US 'strong economic recovery' was a myth
      • The damaging blind alley of US protectionism
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​Data Shows Claim of US 'Strong Economic Recovery' Was a Myth

The publication of official US economic data for 2016, which shows only 1.6% US GDP growth for the year, and only 0.9% per capita GDP growth, clearly demonstrates two things:
  • The major global economic development in 2016 was a sharp slowing of the US economy – as is shown below;
  • Large parts of the financial media failed to analyse this reality of slow US growth and continued to repeat a myth of ‘strong US recovery.’
Two questions follow from this reality:
  • What is the real state of the main centres of the world economy – the US, the EU and China?
  • Given that accurate analysis of the state of the US economy is extremely important both in itself and for economic policy, why did sections of the financial media continue to publish inaccurate material about the US economy?
Using the method of ‘seek truth from facts’ first the data on the growth of the main global economic centres will be given and then an analysis of this.
​
US economy
Official data for US GDP for 2016 was recently published. This confirms clearly the sharp slowdown in the US economy during 2016.
  • US GDP growth fell from 2.6% in 2015 to only 1.6% in 2016 – that is during 2016 the US economy slowed down by almost 40% from its previous growth year’s rate.
  • US per capita GDP growth fell from 1.9% in 2015 to only 0.9% in 2016 – US per capita GDP growth therefore declined to under half of its previous year’s growth rate, and fell to less than an annual 1% which is approaching stagnation.
This data is shown in Figure 1. This trends shows clearly that the claim of ‘strong recovery’ of the US economy during 2016 was entirely a myth. In fact, the US economy was slowing sharply.
Figure 1
Picture

​Comparison to other major economic centres
This data on the slowdown of the US economy is even more striking when compared to the statistics for the other two major world economic centres – China and the EU. What this data shows is that far from the US undergoing ‘strong recovery’, the US was the slowest growing of the major world economic centres in 2016
GDP growth in 2016 was:
  • China – 6.7%
  • EU – 1.9%
  • US – 1.6%
Therefore, not merely did the US economic decelerate sharply in 2016 but the US was the slowest growing of the major economic centres.
Figure 2
Picture

Myths of Western media
It was, of course, perfectly possible during the last year to factually follow this sharp slowing of the US economy as it was taking place. Already in August 2016 I analysed this data. At that time, major sections of the Western media were already attempting to propagate the myth of a ‘hard landing’ in China and ‘strong recovery’ in the US. Bloomberg, in particular, was publishing articles with titles such as ‘Soros Says China Hard Landing Will Deepen the Rout in Stocks’. But in fact, China’s economy slowed only marginally in 2016, from 6.9% to 6.7%, whereas as shown above, the US underwent a sharp economic slowdown.
That is the actual trends in the world economy were the exact opposite of those being claimed in Bloomberg and other sections of the Western media.

Inaccuracy of sections of the media
​
In addition to the inherent importance of accurately analysing trends in the global economy for economic policy making and company strategy clear conclusions can be drawn from the contradiction between the facts of economic development in the last year and analysis in the media. In particular, these facts of economic development again confirm that large parts of the Western financial media is not primarily focussed on accurate economic analysis but on spreading unjustified claims regarding the economic success of the US and unjustified claims regarding ‘economic crisis’ in China.
Two clear conclusions therefore flow from these facts regarding global economic trends in the last year.
  • First given the proven inaccuracy of the Western media the role of independent factual studies by Chinese think tanks and research organisations such as Chongyang Institute for Financial Studies is vital.
  • Second, that the publication of research by Chinese media is crucial for getting accurate data and analysis into the hands of companies and policy makers.
*   *   *
This is an edited version of an article which originally appeared in Chinese in New Finance on 3 February 2017.

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  • Home
  • Economy
    • Economic development & China >
      • Economic growth & human well-being - the example of China
      • China is the greatest economic growth in human history
      • Why China's social achievements are even greater than its economic ones
      • Why China will grow rich long before it grows old
      • China faces slower Western growth than in the Great Depression
      • China's 'socialist development strategy' outperformed Western alternatives
      • Why did China grow so fast?
      • Why are China and India growing so fast?
      • The 'Belt & Road' region will be the main locomotive of the world economy
      • Growth in the G7 'Great Stagnation' Will Be Slower than in the Great Depression!
      • What China achieving 'moderate prosperity' means for itself & the world
      • China is now the main pillar of globalisation
      • Solar power illustrates China's manufacturing future
      • Why China has made the world's greatest contribution to increasing human rights
      • Socialist policies can help famine-stricken countries
      • Here’s why China and BRICS will drive global economic growth
      • BRICS are more important for world growth than the G7
    • Economic theory >
      • China's & Western economic theory >
        • Deng Xiaoping & John Maynard Keynes
        • Deng Xiaoping - the world's greatest economist
        • Why Adam Smith’s ‘classical theory’ correctly explained Asia’s growth
        • The global significance of China's discussion on the economy's 'supply side'
        • China lacks innovation? Take another look
        • A Copernican Revolution in Western economics & China’s supply side reform
        • Why Chinese neo-liberals are forced to falsify world history
        • Why China won't suffer a Western type financial crisis
      • Macro-economics & growth theory >
        • A damaging confusion in Western economics books
        • To become a high income economy China needs to study facts not myths
        • How Singapore achieved a higher per capita GDP than the US
        • The most important book on economic growth to have appeared for many years
        • Why do Western economies have hard landings but China doesn't?
        • Reality & myth of the US 'internet revolution'
      • International monetary system >
        • Europe's crisis & the Euro - predicted in advance
        • The limits of RMB internationalisation
        • China is right to maintain & tighten capital controls
      • China vs the errors of 'shock therapy' >
        • Why the economic reform succeeded in China & will fail in Russia
        • An economist's Mein Kampf
        • How IMF policies helped oligarchs loot Russia - lessons for China and other countries
    • US Economy & China >
      • Why neo-liberalism destabilised US politics
      • Why the US remains locked in slow growth
      • Economic logic behind Trump's foreign policy - the key countries are Germany &China
      • Trump's economy - cyclical upturn and long term slow growth
      • Economic data shows claim of US 'strong economic recovery' was a myth
      • The damaging blind alley of US protectionism
      • US economic growth under Trump - explained in 3 charts
      • China's economy is growing three times as fast as the US
      • The ‘Anglo-Saxon’ political crisis - from Reagan & Thatcher to Trump & Brexit
      • Why the US turned protectionist - while China defends an open global econmy
      • Why Trump won’t persuade Apple to produce the iPhone in the US not China
      • The American Way leads to Americans dying early
  • Foreign Policy
    • China's international relations >
      • China & India >
        • A 'must read' article on current China-India disputes
      • China & Russia >
        • Good China-Russia relations are the guarantee of world peace
        • Increasing interest in Russia in China's economic policy
        • What is really behind Trump's obsession with Russia
      • China & the US >
        • Why 'China bashing' is a disaster for the US people
        • Why a US-China ‘Thucydides Trap’ can be avoided
        • The real reason for the US South China Sea provocation
        • The real sinister relation of the US & 'jihadism'?
        • The neo-con forces behind Trump's Twitter attacks on China
        • Why the US not China threatens world peace
    • Theoretical bases of China's foreign policy >
      • Theoretical bases of China's "win-win" foreign policy concept
      • Hamburg G20 Summit highlights China's 'thought leadership'
      • How Xi Jinping’s Marxism out-thinks the West
      • One year on, impact of Xi's agenda-setting Davos speech still felt
  • China Analysts
    • New economic data shows diorientation of US foreign policy analysts
    • China's GDP data destroys ‘hard landing' myth again
    • Wrong analyses of China - listed by author and date
  • China's History
    • The truth about China’s crucial role World War II is not only history
    • Comparison of Hong Kong and ‘poor whites’ in the US South
  • Other languages
    • 中文文章 >
      • 作为英国人我想对香港说,忘了港英时代吧!
    • Em Português >
      • Lições do desenvolvimento econômico da China para a América Latina
  • Blog
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    • Key China data
    • G7 >
      • US
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