The Chinese economic growth has slow down to 7.6% in Q2 2012. Most economists predicted that China's growth for 2012 will be 7.8-8.4% as compared to 9.1% for 2011. I agree with them. I suppose these are China bulls' predictions.
Chinese bears think China is at the verge of collapse and all data came out of China are lies. Some of them think China is in the middle of a recession or worse, depression.
Chinese bears quoted the reduction of Chinese RE prices and world commodity prices as evidence of Chinese collapse. I think Chinese bears are wrong. Chinese RE price reduction was engineered by Chinese authorities to prevent the Chinese RE market from over heating. World commodity prices collapse was the result of over production.
Chinese bears think that GDP figures released by Chinese authorities are not accurate, they think electricity consumption figures are more accurate about the state of the Chinese economy. Do they realize that the electricity consumption figures are also figures released by Chinese authorities? If Chinese authorities lie about one, why do they not lie about the other? Do Chinese bears realize that if electricity consumption is a good measurement of economic activities, then, the Chinese economy would be much closer to the size of the US economy instead of less than 50% of the US economy? Or the Chinese economy would be more than 2 times the Japanese economy because China use more than 2 times the amount of electricity than Japan.
There are Chinese data we can rely on. These are Chinese foreign trade figures and Chinese foreign investment figures. These figures can be traced from outside China. Chinese foreign investments are growing rapidly and Chinese exports are growing by over 11% even when export to Europe is collapsing. Chinese imports were less than 7%, that is because commodity prices are lower, not because of volume reduction.
If foreign trade figures are correlated to economic activities, then, the rate of Chinese growth of 7.6% is believable.
I believe the Chinese economy will continue to grow or expand at perhaps a lower and lower rate. But the Chinese economy will continue to expand for at least 20-25 years. I am a Chinese bull.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.