James Pethokoukis at US News writes that a new report from Goldman Sachs says that China is now probably the most powerful global economic engine and we all might be singing “Blame China” when the next recession hits our economy:
“So, what constitutes a recession in modern times, and when do they occur?…We suspect it would almost certainly involve a major economic slowdown in China. On almost any criteria (and topic), it is impossible to underestimate China’s positive impact on the buoyancy of world growth this decade. That said, our China proprietary indicators show no sign of an imminent slowdown. In addition, our various proprietary indices suggest that the underlying global macro environment remains favorable…Moreover, if we and the consensus are correct, then the period 2003-2008 will have been one of the most powerful periods of economic growth globally since accurate data has been collectable for much of the world.”
I would add the following to a list of countries to watch: Brazil, Russia and India.