IMF Reports China Will Overtake U.S. in 2016


by LCR contributor Barrel Rider


The latest report from the International Monetary Fund (IMF) has China eclipsing the U.S. as the world’s largest economy in 2016. According to the IMF, the next U.S. President will be the last to lead the United States as the world’s largest economic power. The IMF has dubbed it the end of the ‘Age of America’.



Many are questioning not only the accuracy of the report, they are also exploring motives that may be driving the IMF to stir up global sentiment in regards to the U.S.



The current Chinese economy is roughly one-third the size of the U.S. and the United States is also a major consumer of Chinese made goods. The Chinese are also the largest purchasers of U.S. treasuries.



There seems to be little evidence to support the IMF’s claim. Here are a few red flags regarding the IMF report:

  • China has been plagued by accounting irregularities (scandals) among its publicly owned and traded companies for years.

  • The Chinese economy would have to continue to grow at 10 percent annually year over year with no drop. While the U.S. economy would plug along at 2.7 percent growth.
  • IMF doesn't use per capita GDP.

  • The United States is the largest consumer of Chinese goods.
  • Chinese demographics are working against their economic growth. By 2040, its elderly population will exceed the total population of Germany, France, Britain, Italy and Japan today.

What do you think?

4 comments:

  1. This is a great article! I posted about this Monday and The Heritage Foundation has some interesting points to it as well. The one that stood out to me was when it said "if the U.S. does not get its fiscal house in order, the era of American leadership will be over." If that doesn't say "Fire Obama in 2012!" I don't know what does!

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  2. China has gaing ground for a long time, and will continue.
    They have allot of advanced tec companys that will do well.
    For example, CENET looks like it will be bought buy a large american company

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  3. Good post! You are correct that we should be more than leery about the IMF. The decline that we are in the midst of is anything but inevitable UNLESS we retain the same leadership that we have right now.

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  4. Great points perhaps they also assumed BHO would be re-elected.

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