PATRICK CHOVANEC: China's Most Dangerous Moment Is Right Now

People like Patrick Chovanec have warned of a Chinese hard landing for years, but don’t think we’ve escaped the worst of it.

Chovanec says the trade-off between credit expansion and inflation worries “is much more intense than it was a year ago or two years ago.”

“The incompatibility between those things has really reached a crisis point.”

The motivating factor is China’s need to roll over bad debt, which is locked into existing projects. Without new investment spending, China faces a severe falloff in GDP, which Chovanec says could be reported at 4.2 per cent for the first quarter — and could actually be negative.

Chovanec is interviewed in this video by Nouriel Roubini, who looks bullish by comparison.

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.