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Internal debt is also internal asset, which net out to zero. China is a net international creditor. Its internal debt structure may have implications for its ec
by fspeech 11y ago
Internal debt is also internal asset, which net out to zero. China is a net international creditor. Its internal debt structure may have implications for its economoic future, but is not nearly as relevant as its current account balance for foreign holders of RMB.
- rrggrr 11y agoInternal debt is not an asset because the debt holders are SOE's, provincial governments and companies too big too fail. Therefore the largest share of debt is public debt, and work must be done to raise incomes throughout China so that debt can be serviced by taxes on a healthy private sector.
- beachstartup 11y agoi think previous commenter was referring to the balance sheet definition of debt, which is Assets = Liabilities + Equity