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Yes, but how is the title sensationalist? I think it's quite accurate. They're borrowing money just to pay off the interest on previously borrowed money. 8 tril
by mahranch 11y ago
Yes, but how is the title sensationalist? I think it's quite accurate. They're borrowing money just to pay off the interest on previously borrowed money. 8 trillion Yuan just in 2015 alone. If anything, the title of the article may be understating the problem. Common sense should dictate that it's not a sustainable practice at any level.
- lawpoop 11y agoI think the problem may be that many people see the word 'Ponzi' and jump to the conclusion that it's a Ponzi _scheme_, rather than a Ponzi borrowing situation. Not that I'm the most financially savvy person, but I've never heard the phrase Ponzi borrowing before. Until I read the comments, I glossed it as 'Ponzi scheme'. It completely makes sense, once I read the comments.
- deleted 11y ago[deleted]
- xenadu02 11y agoEh, if inflation is high and the business is a real going concern (not completely useless and corrupt malinvestment) then you can get away with this. It's a dangerous game though.