One wonders if the Chinese government is setting its citizens expectations dangerously high right now.
According to Xinhua, Wen Jiabao staged a chat with Chinese ‘netizens’ whereby he promised to keep inflation under control and prevent a housing bubble.
Thing is, we’re pretty sure that the government is expected to support housing values and stock markets at the same time. While keeping the yuan pegged at a competitive rate vs. the dollar of course.
Obviously China has gotten away with setting pretty high economic expectations for quite some time already, but it seems as if almost every economic variable is now expected to be under the deliberate control of the government.
This is great for public relations while the economy is humming along, but one as to wonder if these government economic guarantees will one day come back to bite, hard. Maybe they should learn the importance of ‘under-promising, over-delivering’ rather than over-promising and then simply hoping for the best.
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