With the West's fitful (can you say: "neutering Volker"?) attempts to bring the banksters to heel, all that Chinese money is now being directed inwardly. With the expected result. I've mentioned the "60 Minutes" report (revealing the ongoing real estate fiasco) from a few months ago, and much earlier stories from print sources.
Today brings us another. Don't be surprised.
I long ago forgot where I read/heard it (you can find it in older essays), but the following semi-quote about sums up the cynic's view:
"One hears from CEO types about how much work it is to run these corporations, but they never seem to want to take on failing companies. The ones they do run could be just as successfully run by a sock puppet."
Which brings us to:
Yao Jingyuan, the former chief economist at the state statistics agency, said ... "With this kind of operational model banks will continue making money even if all the bank presidents go home to sleep and you replaced them by putting a small dog in their seats."
The piece ledes with the punchline, as any cub reporter has been taught to do:
China's financial system is in danger of becoming too big to bail out.
My, my. All that money, and little to do with it, besides build yet more condos.
Official bank lending has more than doubled since the global financial crisis, growing nearly twice as fast as the overall economy.
Without all those Western mortgages to soak up the moolah, China is generating such internally. Good luck with that.
"The chains of lending and borrowing can be long, just like the securitized subprime mortgages. The result can be devastating."...said Yu Yongding, a senior fellow at the Institute of World Economics and Politics of the Chinese Academy of Social Sciences...
Stating the obvious:
Savers have had few alternatives to banks until very recently: Real estate prices are already stratospheric relative to incomes...
Ya think??? Time to copulate.