On the other hand, due to the high oil prices and the bursting ofrealestatebubble, the USA economy is recently giving strong signals of a forthcoming stagflation: a recession with increasing inflation rate.
Until late in 2011, the focus of policymakers in China was on tamping down inflation, stocked by a surge of stimulus spending in 2008-2009 that led to a realestatebubble and an overheated economy.
In the case of the U.S. economy now, the double-whammy of wealth shocks from the real-estate bubble and the stock-market crash has made consumers understandably cautious.