China’s Stimulus Package Not So Charming.docVIP

China?s Stimulus Package Not So Charming After going through 30 years with the 10% annual growth rate, China finally went back to the earth. According to the research team of emerging markets at Barclays, the Chinese government has already issued a new economic stimulus package and the central bank consorted by launching easy monetary policies, but China is marching into a new era of output gap (also called GDP gap, referring to the gap between real GDP and potential GDP). Therefore, Beijing is more cautious when taking actions, which means that the economic stimulus is not as radical as the previous one, and that the potential economic growth falls back to 7%-8%. Throughout the past two months, the of- ficials of different states?central banks were always under heavy scrutiny of the media. The European Central Bank launched the indefinite credit right purchasing plan. Mario Draghi, president of the European Central Bank, said that the organization tried its best to maintain the existence of the European Currency League. He was accompanied by the president of the US Federal Reserves Ben Bernanke, who announced the US indefinite credit right purchasing plan -better known as the round 3 of quantitative easing (QE3). The issuance of these policies greatly inspired the market, where players expect Beijing to enhance the confidence of venture assets markets through its economic stimulus package. China is certainly about to launch a series of all-round economic stimulus measures to stop the economic growth from being further slowed. As the data from Barclays and Nomura shows, the Chinese central bank, central government and local governments, have already worked out the expenditure plans of 11 trillion yuan (approx. US$ 1.74 million) by the end of September 2012. The analysts at Nomura estimated the GDP growth rate of China in the third quarter at 7.7%, which will rebound to 8.8% in the following quarter. But Barclays pointed out that the structural and cyclica