COMMENTARY

Peter Burgess

Comparison of GDP growth in China over several quarters with stock market performance in 2011

I made the following comment on the website where this graphic appeared http://discussions.latimes.com/20/lanews/la-fi-china-bears.eps-20111128/10?

This is a thought provoking graphic. It would be good to see the 10 year trend of GDP and the 10 year trend of stock indexes for all of these countries ... and at the same time remembering that the accounting in the enterprises is often quite questionable, even worse than in US and European companies! My sense is that there is a significant bubble in many of these markets. I was in Thailand 5 years before the Asian financial crisis of 1997, and China today has some of the same 'look' and 'feel' with overblown new construction, part of the population with high wealth growth and the worker segment employed but underpaid.