If No Trade Reversal Now in China, Then When?

Micheal Pettis says:

There is developing in Beijing, I think, almost a panic about global economic prospects and the impact of the European crisis on China. This panic is going make the rebalancing process harder than ever because a Chinese rebalancing almost necessarily requires a rapid slowdown in growth as investment decelerates sharply long before a rise in consumption can take up the slack. Weakness in the export sector makes the slowdown all the more costly.

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