China's slowdown could be just a blip, if 1960s Japan is a guide

Hong Kong

CHINA'S economic slowdown and market crash often evoke comparisons with Japan's bust in the 1990s, a period that saw the world's second-largest economy of the time tip into prolonged stagnation.

Both economies experienced rapid, debt-fuelled growth that spurred soaring real estate prices and stock market bubbles. Japan's run-up eventually ended in a hard landing that the country is still recovering from. The argument says China could end up suffering a similar fate.

Yet a more apt parallel may instead be its neighbour's experience of the 1960s. That's according to Paul Sheard, chief global economist at ratings company Standard & Poor's in New York, who worked in Japan …