According to the International Monetary Fund, when looking at purchasing-power, China is right now overtaking the US to become the world’s largest economy.
By the end of this year, China will constitute 16.48% of the world’s purchasing-power and the US will make up 16.28%.
This is according to ‘adjusted purchasing power’:
The simple logic is that prices aren’t the same in each country: A shirt will cost you less in Shanghai than in San Francisco, so it’s not entirely reasonable to compare countries without taking this into account. Though a typical person in China earns a lot less than the typical person in the US, simply converting a Chinese salary into dollars underestimates how much purchasing power that individual, and therefore that country, might have. The Economist’s Big Mac Index is a great example of these disparities.
So the IMF measures both GDP in market-exchange terms and in terms of purchasing power. On the purchasing-power basis, China is overtaking the US right about now and becoming the world’s biggest economy.
We’ve just gone past that crossover on the chart below, according to the IMF. By the end of 2014, China will make up 16.48% of the world’s purchasing-power adjusted GDP (or $17.632 trillion), and the US will make up just 16.28% (or $17.416 trillion):
IMF, Google Public Data ExplorerAdjusted for purchasing power, the IMF thinks China’s economy is now the world’s largest.
It’s not all sour news for the US. It’ll be some time yet until the lines cross over in raw terms, not adjusted for purchasing power. By that measure, China still sits more than $6.5 trillion lower than the US and isn’t likely to overtake for quite some time:
1400 years of this.. Time to straighten the world back out!! Vote for 2nd
Amendment .. We will be ready!!
China and Russia, are beefing up there Military, and their economy, While Obama, is tearing down and decreasing ours! ! Should tell you Folks, something about How the Liberals and the Democrats Operate, They want the Destruction of America, Now Tell Me, How Dumb of and Idea is That, to Destroy Your Own Country?
What goes up must come down. (Look at the US & Japan)
That is Obama for you, a muslim, and ISIS suporter.
Not good,at all !
obama AND his COMMUNIST-muslim DEVILS AT WORK AND CONGRESS ALLOWED THIS TO HAPPEN. VOTE ALL OF THEM OUT. AMERICA NEEDS NEW LEADERSHIP.
kahudes.net BRICS forhumanity
The leftist media in this country will do its best to keep facts like this mute! And the young, who are not interested in news have no idea what’s going on…
wonder why
wonder why. look who we had