Say you're at a railway station, waiting for the slow train to eurogeddon. You've been told that the eurozone is in deep trouble with all those piles of debt, that it will fall apart inevitably, dismembering the euro and inflicting pain and misery around the world.
Months go by, and although there's a lot of shunting and hooting, and lots of frenetic activity, the eurogeddon train doesn't steam in. You begin to grow impatient, and wonder if the train is coming at all. And then in the way that we all do, you crane your neck over the platform in the direction from which you expect the train to come.
And then, before you can say PIIGS, a monstrously big train steams in from the other direction on the same track - and knocks you down flat.
That train, which no one saw coming at all, is the high-speed rail to China-geddon: an economic hard landing scenario in China that will be just as ruinous as anything that's happening in Europe. In some ways, it could be rather more painful because, unlike with Europe, everyone believes China is doing just fine - and will, if anything, bail out the world.
Increasingly, however, the realisation that China, which has seemingly disproved every economic theory about the boom-bust cycle over 30-plus years of top-speed growth, will no longer be immune to the laws of economics is dawning on investors and analysts.
Earlier today, the Asia-focused fund manager Marc Faber told CNBC that he is today more worried about a Chinese economic downturn than a recession in Europe.
In fact, in his reckoning, a slowdown is already under way in China. "The (Chinese) economy consists of many sectors and I think some sectors are already probably in a recession," Faber told CNBC. "I think growth will be much lower and it is possible that we could have a hard landing with no growth at all."
In his estimation, such an outcome would have a "devastating impact" on the global economy.
Grim as Faber's pronouncements may seem, they are rather rosy compared to what renowned economic commentator and business professor 'Larry' Lang Xianping has to say. Nicknamed "Mr Lang, the Monitor" for his repeated exposes over the years on the problems in China's economy - which subsequently were proved right - Lang has a truly frightening prophesy to make.
Speaking at a closed-door seminar in Shenyang a month ago, Lang revealed, among other things:
- China's economy, contrary to claims that it grew by 9.1 percent, is actually in recession, and contracting by perhaps as much as 10 percent.
- China's inflation rate, again contrary to government statistics putting it at 6.2 percent, is close to 16 percent.
- China's debt burden is about $5.7 trillion, more than the size of its economy. Of this, local government debt makes up about $2.5 trillion, and the liabilities of state-owned enterprises about as much.
And with the interest burden mounting at an exponential rate, he reckons it will all unravel rapidly.
In his assessment, China is just as bankrupt as any European peripheral country, and when the "economic tsunami" hits, it will be worse than what Japan experienced in the 1980s.
Lang did not want his speech to be reported, but a clandestine audio has made it to the web (it's in Chinese), and his speech has been reported here. (Note: The Epoch Times is a propagandist Falun Gong publication known for somewhat sensational articles on China that strain credulity, but the authenticity of Lang's speech is not in dispute.)
Even mainstream analysts are increasingly beginning to articulate a China hard-landing scenario.
Responding to claims by China bulls that Chinese authorities will engineer a soft landing of the economy, Societe Generale analyst Albert Edwards says he cannot understand this confidence. "A soft landing may indeed be the (intended) outcome, but it's unlikely. China is undoubtedly a severely imbalanced economy, suffering from credit-fuelled investment and housing excesses that could easily spin out of control and crash, just like all the other highly regarded economic bubbles before it."
China, says Edwards in his inimitable prose, is a "freak economy." No other economy in history, he points out, has experienced such high investment to GDP ratios and seen so many sequential years of strong investment growth. "If you came down from Mars and saw an economy with an investment/GDP ratio of 50 percent, you would conclude it would be among the most volatile in the world, not the most stable."
As we'd noted earlier, there are already signs that the bubble is already deflating in parts of the economy. That problem in Wenzhou, one of the centres of Chinese entrepreneurial excellence, has since spread to other parts of China, including Ordos in Inner Mongolia, which earned a reputation for being something of a ghost town - a large city with no inhabitants. Stand by for more such scary stories.
There is no easy way for China to avoid the bust that is coming, reasons The Wall Street Journal. In its estimation, for all the misery it will cause, it comes with a silver lining: that China's state-led growth model will be discredited, and a debate will begin on restarting the reforms that stalled in the mid-2000s.