By: Bill Bolen
As we post this on the blog we are in the middle of ongoing trade and tariff discussions with China that have real implications for our economy and the markets. Blog readers who are older may remember the “rise of Japan” that occurred in the 1970s and 1980s that moved Japan to the #2 position in the world in terms of GDP. Japan held onto that #2 position until 2010, when China’s rise that started in the 2000s led them ahead of Japan and into the #2 spot that they still occupy today. The rise and fall of various world economies can be easily seen in this visualization video courtesy of the Visual Capitalist website at https://www.visualcapitalist.com/animation-the-worlds-10-largest-economies-by-gdp-1960-today/ that shows the top 10 world economies from 1960 to today in an animated video format. It is a fascinating reminder of how things have changed over time and an easy way to understand why today a trade battle between the U.S. and China is such an important factor in world markets.
For those interested in diving deeper into what has driven the growth of China over the past 20-30 years, the New York Times recently published a five part story on China that digs into the topic with photos and analysis framing how China has attempted to modernize their economy while still holding onto their Communist authoritarian approach to government. You can start with the first part via this link https://www.nytimes.com/interactive/2018/11/18/world/asia/china-rules.html (may require a subscription depending on how many free articles you have read this month).