But a few eye-catching press reports have been raising serious questions about China. It’s clear that the country has an enormous debt bubble—one created on purpose (at least in part) to get its economy through the 2008 downturn. The questions are: Will it pop and if so, when? Is the country’s $3 trillion stockpile of foreign cash enough to mitigate a disaster? Is the country’s patented brand of aggressively state-subsidized capitalism a new paradigm (cough) or does each successive intervention worsen an ultimate reckoning? And how badly would a Chinese crash affect the rest of the world?Sponsored Ads
The situation there reminds me of what 2007 felt like here: Lots of signs that things were seriously amiss and an understanding that we were in for a nasty fall but couldn’t know exactly how it would unfold (emphasis mine):
Time magazine has an article out called, “Be Very Afraid of The China Bubble.” Unfortunately, it’s for subscribers only.
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