There’s reason to remain skeptical about China’s economic growth, Marc Faber, editor and publisher of the Gloom, Boom & Doom report, told Bloomberg TV in an interview.
China is expanding at a rate of about 3-4 percent, much slower than government figures show, Faber said Monday.
Figures released Oct. 18 by China’s National Bureau of Statistics showed gross domestic product rose 6.9 percent in the three months to September 30 from a year earlier.
“Growth figures that the government are publishing do not match the reality” and the most recent estimate “doesn’t rhyme”, Faber said.
“Evidence shows that it’s nowhere growing at the same pace it was growing, say, between 2000 and 2007.”
GDP growth in China averaged 10.5 percent during that period, peaking at a 14-year high of 14.9 percent in 2007, National Bureau of Statistics figures show.
The economy hasn’t grown at the pace Faber suggests since figures started being collected in 1992.
“I have no doubt that some service sectors are growing”, but industrial production isn’t, said Faber, a contrarian investment adviser and fund manager who bears the nickname “Dr. Doom”.
He cited falling exports, imports and railway freight traffic among indicators that are “very negative”.
Investors should be mindful of a credit bubble of “epic proportions”, as well as the “very heavy capital flight” from Chinese investments, Faber said.
“I would bet on the locals, who are shifting money out of China at a record level at the present time,” he said.
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