Basically, GDP is about the sum of all value-added economic activities within a territorial entity during a certain period. 

The most tricky thing about GDP is “value.” Milton Friedman, an icon of freedom and capitalism, famously debunked the centrally planned Soviet economy which boasted GDPs surpassing America’s. To paraphrase Friedman, you can claim to add value with full employment by giving each digger a spoon. By the way, you can always make up your numbers unchallenged in a police state.

China is not so bad as the former Soviet Union where GDP is concerned. Still, given whatever GDP numbers Beijing may come up with, we have to ask this: How much real value has been added? 

No economy can afford too many bridges to nowhere or too much speculation in the housing market. Japan learned it the hard way, and so did America. But, unlike the CCP, the governments in America and Japan had to face their voters who demanded change. Change is not easy in a democracy. In an autocracy, change is a taboo.

In my opinion, it is quite meaningless to measure China’s economic health in terms of its publicized GDP. That said, I think China can muddle through economically. Going forward, though, the shadow of debt will loom larger and larger over China. "Don't worry!" Wall Street may tell you. "Isn’t China's bond market doing pretty well these days?"

Roman wisdom: Caveat emptor (" Buyer beware")

--- by Lingyang Jiang