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As the saying goes: If you owe someone $100 l, that is your problem. If you owe someone $100 Billion, that is their problem. My guess is that the Chinese econ
by RcouF1uZ4gsC 4y ago
As the saying goes:
If you owe someone $100 l, that is your problem. If you owe someone $100 Billion, that is their problem.
My guess is that the Chinese economy cannot afford to have those loans go bad so they need to do a bailout. This is a move of desperation, not a move of dominance.
- toomuchtodo 4y agoChina bet Africa was the future, and while China might be early, early is the same as wrong if you can’t stay solvent until your investment is liquid (China economy slowing, manufacturing moving elsewhere, rapidly aging population, etc).
- seanmcdirmid 4y agoThe Chinese banks that made the loans can’t take the losses on their balances sheets, even if they are state owned their shares are traded on the market (and SOE debt is technically not counted as national debt), so a bail out has to occur at least on paper.
- fspeech 4y agoDoubt that public traded banks made these kind of loans. Policy banks are not public traded.
- qikInNdOutReply 4y ago? That share market in china is a inhouse market, and completely state-controlled. There is no "free" market as in its public and free of influence. It already collapsed once and was propped up.
- fspeech 4y agonot the point. just like svb, ownership is only relevant to how management is incentivized by how compensation (monetary and otherwise) is structured.