China’s stock market is back to where it was one year ago. But what exactly does that mean for your portfolio?The World Bank just upped China’s economic growth projection from 6.5 percent to 7.2 percent. If China’s economic rebound is real, it would open up all kinds of investment opportunities. Assets like iron ore and copper would suddenly look bullish. Countries like Australia, Brazil and Canada would suddenly have brighter prospects. Asia as a whole would be more attractive to investors.

So, is China’s growth for real?

No, it’s not. It would be if its growth were driven by export-demand or consumer-demand or foreign investment. But, unfortunately, China’s growth is stimulus-led. China’s stimulus package is huge and contributes to two-thirds of China’s economic expansion. Tellingly, exports are way down.

What happens when all that stimulus money goes away and the U.S. market is still nibbling rather than gorging on Chinese products as it had done in the recent past?

That’s easy. China will simply spend more. It can afford to, so why not?

But an economy so dependent on government-spending should not attract your investment dollars. China being back to where it was a year ago should not be construed as progress…

Last year it was reeling from its export markets’ dramatic shrinkage. That was real. These same markets have continued to shrink. That’s also real. These stimulus projects? They create jobs that last 3-6 months. That’s not so real.

The best way to invest in China’s fake recovery is to short one of the several ETFs which track Chinese companies.