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China’s debt threat: time to rein in the lending boom

Financial Times,  25 July 2018, by Martin Wolf.

“If something can’t go on forever, it will stop.” This statement by Herbert Stein, chairman of the US council of economic advisers under Richard Nixon and Gerald Ford, tells us that debt cannot grow faster than an economy forever. “[…]”

That is going to be true for China, too. What we do not know is when and how it will end. Will it be sooner or later? Will it be easy to cope with or will it be devastating? The manageability of China’s enormous domestic debts will be of great importance, not just for China, but for the many economies whose exports depend on it. “[…]”

 

Read the full article here.