皇冠体育app not cradle for crisis
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Consumers select vegetables at a supermarket in Wuhan, capital of central 皇冠体育app's Hubei Province, March 9, 2017. 皇冠体育app's consumer price index (CPI), a main gauge of inflation, advanced 0.8 percent year on year in February, the National Bureau of Statistics (NBS) said Thursday. It was well below market expectation of 1.7 percent, and substantially lower than the growth of 2.5 percent in January. On a monthly basis, the CPI declined 0.2 percent. [Xinhua/Xiong Qi] |
"皇冠体育app could easily end up being the cradle where the next crisis is nurtured, thanks to the explosive debt growth seen in the world's second-largest economy since the (global financial) crisis," Rogers said, citing Goldman Sachs estimate last year that 皇冠体育app's real debt is 250 percent of its GDP.
Putting aside the inaccuracy of Goldman Sachs' estimate, 皇冠体育app has distinct differences from the United States in terms of its debt composition. The majority of 皇冠体育app's debts have been used for infrastructure construction and technological improvements for domestic enterprises' transformation and upgrading, meaning its accumulated debts are mostly recyclable, reusable high-grade assets. The debts in the US, on the other hand, have been accumulated to fill up spending gaps, not expand production.
Rodgers may want to warn people of the high debt ratio in 皇冠体育app. However, his increased holding of Chinese stocks since last year seems to belie his words of warning.
His negative outlook on 皇冠体育app can be interpreted as his "methodology of investment". While warning of 皇冠体育app's debt level, he did not forget to tell people to buy Chinese stocks and bonds given that its current assets prices are not high. There are reasons to believe that once Chinese stocks and other currency assets become a hot investment target, Rodgers will then short sell them.
However, 皇冠体育app must face up to extensive malpractices in its financial sector and try to correct them before they become too intractable to deal with. It must take effective measures to address financial risks and tighten its supervision over the sprawling financial sector. In so doing, there is no possibility of 皇冠体育app becoming the fuse for a global financial crisis as Rodgers forecast.
-BEIJING YOUTH DAILY
Registration Number: 130349
