Skip to comments.What’s the greatest risk to China’s economy? Look no further than its growing...
Posted on 02/16/2018 8:37:56 AM PST by TigerLikesRooster
Whats the greatest risk to Chinas economy? Look no further than its growing corporate and household debt
China has been one of the leading generators of debt since 2009, contributing to the latest worries over global inflation that have roiled markets
PUBLISHED : Friday, 16 February, 2018, 6:01pm
UPDATED : Friday, 16 February, 2018, 6:13pm
Few investors study history. And the ones that do, dismiss the lessons as being irrelevant for the current market. Predicting Chinas upcoming economic collapse is a popular contrarian viewpoint, but it is not so easy to generate a convenient scenario if you look at data that is driving global inflation fears.
Credit is like a ghost in the machine for banks. It moves through their balance sheets and, ultimately, the markets without senior managers and traders knowing about the cumulative risk, lack of diversification and liquidity problems until it is too late. Much of the new technology being employed by globally and systemically important financial institutions since the global financial crisis along with new rules by BASEL is supposed to better capture and quantify risks.
But China represents a complex case of politically controlled banks whose concept of risk control is vastly different from their western counterparts. Examining the source of credit growth points to its possible future risks.
(Excerpt) Read more at scmp.com ...
From every 10 billion debt we make I hear China is generating like 100 billions itself
China is acting like a nation willingly pushing itself to insolvancy and packing up as much material goodies before it gets out and screws investors
We told these private companies they would nationalize and shut after a “crisis” scam, but they thought they were smarter
Also: China’s Further Vulnerabilities.
I am torn. I’d love the commies to get their comeuppance and stall their supposed challenge for global supremacy. However, the Chinese’s economy collapsing would be practically apocalyptic for the global economy, at least for a while.
From the South China Morning Press, and you believe what they say?
What??? A Socialist government relying upon currency to run its economy?
How can debt really exist in a Communist dictatorship?
The Politburo can wipe it all away by decree. Is anyone really going to send bill collectors when they’re nuked-up?
debt and printed money, created by central banks, is the death of the middle class everywhere
If the Deep Global State goes down, I expect massive global default on debt.
And I think it will ultimately be a good thing.
One very important issue that is not touched on in this article is China’s rapidly aging population. She is creating more debt burden for her future population which will be smaller. I have said repeatedly on FR that managing China’s decline will be much harder than managing her ascent...
I think their economy is not in nearly as peachy shape as they want us to believe.
SCMP is based in Hong Kong and probably one the most creditble media outlets in the world. They do actual journalism.
As for managing China's descent, it will lead to the breakup of the country. The prosperous region would refuse to carry the burden of propping up economically backward region when they themselves are struggling. Some regions would fare OK while other parts of China could be hit with severe economic problems.
The SCMP is based in Hong Kong, but the ownership is for China.
Just be aware of that. Unlike American journalists please do not confuse journalists from other countries. They are very much for the own countries.
You are not going to find a media outlet in Asia which cheerleads for the enemy the way America's mainstream news outlets do. Even the Asahi group, the most leftwing of Japan mainstream outlets doesn't go that far. For that matter, neither does the Akahata, official organ of the Japan Communist Party.
How in the world can you talk about China as some sort of shrinking violet?
China is completely dominating. Even our own American companies are sold out. That is the worst part. American companies are helping China dominate.
While “Russia” is allegedly some sort of issue.
China is growing, and growing very strongly.
In the meantime, they have huge cash reserve they can throw around. That will do great damage.