China's Economy Is Worse Than You Think

China's Economy Is Worse Than You Think - Bloomberg View
The unreliability of Chinese official economic data has become almost a cliche.
A few years before he became China's premier, Li Keqiang said that the country's numbers were "man-made" and "for reference only."
If the top economic policy maker of a country says that the numbers aren't reliable … well, you believe him.
But how unreliable?
The fudge factors might only be a few tenths of a percentage point.
It's very hard to fake economic numbers in the same direction for a very long time -- eventually, it becomes obvious to everyone that your economy is either much bigger or much smaller than the cumulative growth rates would have indicated.
Something a bit like this happened to China back in 2007, when the Asian Development Bank reported that China's gross domestic product was much smaller than believed. Chinese inflation had been understated, leading to real (inflation-adjusted) growth numbers that had been too high for too long.
In the current economic environment, the big question is whether China is suffering a deeper slowdown than is generally believed..."