China's GDP Story is America's GDP Story, Too

China's economy grew by 8.7 percent in 2009 -- and a blistering 10.7 percent in the fourth quarter alone.These are important paragraphs:

Retail sales rose 16.9 percent in 2009, as China encourage domestic spending to make up for lost export business during the recession.

But concerns are rising of a growing property bubble in China, fueled by lending which has seen property prices grow 50 percent or more in some cities.

Asia's retail explosion is key for the US economy. With unemployment stuck at 10 percent and unlikely to fall much over the next year, we don't have the firepower to lead a retail comeback on our own. It's not just that we're not buying many goods. We're also stalling the construction comeback by moving less than at any time since World War II. In the short-term, we need help from exports, a cheap dollar and voracious overseas demand. That's why the roar coming out of eastern Asia is good news indeed for the US economy, and it's the reason why manufacturing has been on a tear for the last half year even as unemployment inched higher.

But that second paragraph also explains why American policy makers will be keeping an eye on the property "bubble" in China. Dan Indiviglio rounded up some smart thoughts on whether China was at the precipice of a dangerous pop and concluded ... probably not. Still there are disconcerting facts about the pace of China's real estate boom, like this: New home mortgages in the first nine months of 2009 were $139.5 billion, four times the amount offered a year earlier.