China on the verge of recession?

Not this year but possibly the next. None believes the official GDP growth numbers from the Chinese government. Throw in a power struggle and that electricity consumption had a startling drop in April and many are on edge about their investments in this country.

Count Jim Jubak and I among those bearish. He's got a good article up today about why China could be headed for more than just a hiccup in it's economy. I think the real estate bubble in Shanghai and the smaller cities could tip the scale.

In a market that is hard to get reliable stats for, I would try to focus on power consumption and non-performing loans numbers to try to predict where this market is headed.

Watch this!

Jubak added CMED to his watch list. China Medical Technologies stands to gain from any stimulus the Chinese government might do to keep things moving in their economy. Note that he is just keeping an eye on it, he's been noting in his journal that keeping mostly in cash and waiting on the sidelines is most prudent at this juncture.

FXP for hungry China Bears.

Jim Jubak, a guy with a great track record over at MSN Money, has written about China and the risk involved. There is a Proshares offering, FXP, that tries to double short the FXI. Check the holdings of FXI so you know what you're getting into. If you're of the opinion that China's market will drop further, give FXP a look.