As the world leaders, other countries look up to us. We have taught them well... the Chinese are getting very inconvenienced by the data coming out of their property index reports. Now let's be honest, just about anything coming out of China has to be taken with a dump truck worth of salt, unless you are a CNBC commentator. Or HFT computer which must react to data in 1/4000th of a second. So in no way am I implying this report was very accurate.... even with the best of intentions trying to measure a country so vast, with such variances in development would be difficult. But it was watched by both the masses of people (who apparently were getting frustrated with what they saw) and outside observers, considering the genesis of the Chinese economy is "property building".
Solution to a report where you don't like the answers?
No more report. That will teach the statisticians to put out data the central command does not like.
- China's statistics agency said it will stop publishing the country's much-watched official index of national property prices, scrapping a set of data whose accuracy was widely questioned but which also had become a rallying point for public anger over rapidly rising housing prices.
- The announcement Wednesday, part of a broader revision of property-price data by the National Bureau of Statistics, fueled already widespread frustration and skepticism about the quality and transparency of economic data in the world's second largest economy.
- It came just a day after the statistics bureau published a lower-than-expected inflation reading based on a revised formula for the consumer-price index that economists criticized as lacking transparency.
- The move is likely to make it harder for executives and investors to gauge national trends in China's property sector, a huge driver of its economic growth and of global demand for steel, cement, and other inputs.
- The national property-price index has been criticized for understating the severity of the country's property bubble by diluting the large rises in big cities with tamer changes in smaller ones. It will now publish only separate data for the 70 cities that made up the index, and it will use a new method of calculating property prices that only looks at housing, not commercial property.
- The bureau's previous property data series relied on information from a survey of transactions, conducted at a local level. Those transactions were meant to be representative, but the series was widely criticized by analysts and the general public for failing to reflect the sharp increases in housing prices in recent years.
- Analysts have long complained about flaws in China's official data—a problem common in developing countries—but the issue has taken on added global importance as the Chinese economy has become the world's most important engine of growth in recent years and a major factor in global markets.
- Last week, the International Energy Agency complained that it was unable to make a reliable forecast for China's oil demand this year because of what it called "huge uncertainties with respect to official data."
- Chinese officials have acknowledged the need to improve. Indeed, according to a U.S. diplomatic cable published by WikiLeaks, Vice Premier Li Keqiang—widely expected to take over in two years as premier—told the U.S. ambassador in 2007 that China's GDP figures are "man-made" and therefore unreliable." (which is why it is laughable watching U.S. investors move trillions of market value based on all these figures, as if gospel ...)
- This week's statistics changes, which come as Chinese consumer and property prices are under intense global scrutiny for signs of inflation and asset-bubble pressures, drew sharp criticism from some analysts. "It's just like changing the scale of a thermometer, and then telling a patient they no longer need to take medicine for their fever, and the whole family cheers that the illness is cured," Xu Xiaonian, a professor of Economics and Finance at the China-Europe International Business School, said on his personal microblog Wednesday.
- .........people don't trust the numbers because the National Bureau of Statistics "is extremely non-transparent when they make revisions...They just don't tell you what they are doing, or they tell you in a way that raises more questions than it answers." He said the lack of transparency reflects the political culture in China, which is still closed and secretive.
- Under the new method, the bureau will instead rely on data from online property registries maintained by local authorities, initially in just 35 cities. The remaining cities will continue to use the survey method but will switch over as they develop their own online property registries.
- Many local observers felt the timing of the changes was just too convenient for Beijing.
[Aug 5, 2009: Chinese Provincial Figures Far Overstated Versus National Figures]
[Dec 7, 2010: Wikileaks - Chinese GDP Figures, "Man Made"?]
[Sep 13, 2010: What's China's Real Inflation Rate? (What's China's Real Anything?)]
[Nov 12, 2010: Even China Accuses China of Fibbing about Inflation]