China Faces Economic Stagnation Unless It Reforms Unsustainable Model, Warns Nobel Laureate Krugman
• China's economy heading for era of stagnation and disappointment, says Nobel laureate Paul Krugman • Economic model unsustainable due to ultra-low consumer spending and overreliance on investing • Problems mirror 1980s Japan, but China may not resolve issues as well politically and socially • Leadership's arbitrary interventions hamper efficient management
• Bubble bursting in massive real estate sector, making up 25% of GDP, sparking defaults