What if World Business Cycles are less US-centric?

China economy on a GDP purchasing power parity basis became the largest in 2013 and it is now 25% larger than the USA. China’s economy will be 30% larger in 2019 and 50% larger in 2023.

China’s GDP statistics do not show recessions but the transparent Shanghai stock exchange showed a hard crash in 2015 and had bear markets in 2016 and 2018.

The parts of the US economy that industrial and agricultural had a recession which is now categorized as an overall mini-recession in 2015 and 2016.

China’s consumer spending is still only $5 trillion versus $12.8 trillion for the USA. However, China will be at about $7 trillion by 2022 versus $14 trillion for the USA. China will be at about $10-11 trillion by 2027 and about 65-75% of the US consumer spending level.


source: tradingeconomics.com

A Seeking Alpha writer and investment advisor and owner of True Vine Investments wrote an article under the assumptions that there was a recession in 2015 and 2016 and that China’s larger PPP GDP economy is a larger factor in the overall world business cycle.

He came to the following conclusions:

There will 3 to 4 years before there is a recession.

The next few years will see
* Lower U.S. dollar
* Renewed strength in commodities and quality developing markets
* The outperformance of U.S. large caps versus small caps
* Higher interest rates globally