Balancing inflation, overcapacity and asset bubbles. Is that all?

• Published 23 Dec 2009

Peering into our crystal balls for 2010, things appear bleak or complex, but there are at least some silver linings.

The character of this year was somewhat similar to 1998 – an external shock necessitating strenuous domestic stimulus that kept the economy off the rocks. Next year, though, may be more like 2007 – an abundant supply of money stoking rising prices and alarm over overheating. Of course, 2010 would be most unlikely to play out exactly like 2007 because, as Mark Twain said, "History never repeats itself; at best it sometimes rhymes". But, as a reference for the shape of things to come, 2007 isn't a bad place to start.

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• Capital Intensive China

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