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SHANGHAI (AdAgeChina.com) -- In early December 2008, Chinese President Hu Jintao warned fellow Communist Party members and countrymen, "In this coming period, we will starkly confront the effects of the sustained deepening of the international financial crisis and pressure as global economic growth clearly slows. [The slowdown will] steadily weaken our country's traditional competitive advantages." This warning was delivered a month after the government announced a $586 billion economic stimulus package over the next two years. Was the speech last month a signal of extreme caution? If so, the signals sent out from the top seem to be working. Stock markets and consumer confidence move because of a combination of two factors -- market fundamentals and popular sentiment. Thanks in part to reassurance from party leaders, retail sales during the first three days of 2009 rose 13% year-on-year in the midst of a global recession.

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