Readers of this column will be familiar with the contention that China’s GDP – both nominal and purchasing power parity (PPP) – are significantly underreported compared to developed economies, especially the US (see here and here).
China is NOT the world’s second-largest economy. Back-of-the-envelope calculations suggest that China’s PPP GDP is two to three times that of the US (with nominal GDP approximately 1 to 1.5 times that of the US). The entire premise that an American Goliath was going to push around a Chinese David had it completely backwards.