China's Stimulus Package

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China is pumping in $586 billion in infrastructure spending, as well as capital gains tax cuts to try and stop the economy from slowing too drastically. Basically, if they drop from 12% to 5% growth, it is basically a recession for them, and would have similar effects on their economy. Thus, they are spending what comes to 15% of annual economic output.

That is a big stimulus package.

What worries me more is if loans in china start to go bad with the weakening economy. Then we are in for a very hard landing.

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