Electricity production in China, a key indicator of economic growth, points to zero growth, author Gordon Chang told CNBC on Wednesday.
“By far the most reliable indicator of Chinese economic activity is the production of electricity. When you look at the April-through-July period, electricity production increased by less than an average of 1.2 percent,” he said on “Fast Money.”
“And because the growth of electricity historically outpaces the growth of the economy, it means the economy can’t be growing more than zero,” he added.
“If you look at the manufacturing surveys, the price indices, they suggest zero growth, as do the mountains of copper in the car parks and the iron ore in the graineries.”
Chang, author of “The Coming Collapse of China,” said other headwinds, such as an anti-reform government, will also hurt its economy.
“After 35 years of growth, the wheels are coming off the Chinese economy,” he said.
Trader disclosure: On Sept. 5, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders: Jon Najarian is long AAPL CALL SPREADS; Jon Najarian is long JPM CALL SPREADS; Jon Najarian is long SBUX CALL SPREADS; Jon Najarian is long FB CALL SPREADS; Jon Najarian is long GOOG CALL SPREADS; Jon Najarian is long LNKD CALL SPREADS; Jon Najarian is long CME; Jon Najarian is long CBOE; Jon Najarian is long GLUU; Jon Najarian is long STSI; Pete Najarian is long AAPL; Pete Najarian is long C; Pete Najarian is long INTC; Pete Najarian is long SBUX; Pete Najarian is long FB; Pete Najarian is long MSFT; Pete Najarian is long NOK; Simon Baker is long AAPL; Simon Baker is long BAC; Simon Baker is long GS; Simon Baker is long WFC; Simon Baker is long AMZN; Simon Baker is long GOOG; Simon Baker is long P; Simon Baker is long LNKD; Simon Baker is long YELP; Steve Grasso is long AET; Steve Grasso is long ASTM; Steve Grasso is long BA; Steve Grasso is long F; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long NVIV; Steve Grasso is long PFE; Steve Grasso is long S.
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