They’ve announced very significant local government spending initiatives in a number of major cities, a number of provincial spending initiatives,” he said. “When they have a problem, they use investment. Yeah, they have high investment share of GDP but their overall stock of productive capital per worker is miniscule.”
Roach added that China still has a long way to go to broaden its economic base.
“You don’t inject consume DNA into a large economy like China overnight. I’d say over the next several years, you will be shocked and surprised at the strength of the emerging Chinese consumer, but they’re coming from a low base. It is not an overnight experiment.”
Trader disclosure: On Sept. 4, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders: Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long AGU; Guy Adami is long MSFT; Guy Adami is long NUE; Guy Adami is long BTU; Stephen Weiss is long HK; Stephen Weiss is long QCOM; Stephen Weiss is short X; Stephen Weiss is short TCK; Stephen Weiss is short AKS; Stephen Weiss is short VALE; Stephen Weiss is short AAPL PUTS; Joe Terranova is long VRTS; Joe Terranova is long WFM; Joe Terranova is long AAPL; Joe Terranova is long CSTR; Joe Terranova is long CHKP; Joe Terranova is long EMC; Joe Terranova is long NXPI; Michael Murphy is long WFC; Michael Murphy is long TGT; Michael Murphy is long SDS; Michael Murphy is long JCI.
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