iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
19,912 Blog Posts

Morgan Stanley: ‘No Developed Country Has Taken As Much Debt As China, in the AC World’

Watch every second of this video and absorb it into your thick, fucking, skulls. You’re all laughing now. Very soon, you will be shining my shoes for convincing you to board the ark.

China’s debt bubble is unprecedented, unsustainable, and is getting increasingly egregious as growth slows.

Morgan Stanley’s head of EM weighs in heavy.

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10 comments

  1. 99 lead balloons
    99 lead balloons

    I Lived in China years ago for grad school. The bubble popping will be disastrous for so many people.

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  2. roundwego

    The rot is every where. Bad debt is global. Dead beats are global. Cus easy credit means corruption. Default on the rise. Suicides on the rise. Moral hazards on the rise. Same as it ever was. Why cus our brain is no match for our gut.

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    • frog

      “our brain is no match for our gut.”

      Indeed. Mankind’s biggest problem. People do what feels good in the moment and get addicted to something– often addicted to greed. All these meditators tell you to be in the moment, in the here and now. But most of the people who are doing that, are effed up, from ignoring the long term consequences of what they’re doing.

      I love meditation. But I am not fool enough to try to “be in the here and now” all the time. Some balance is necessary for sanity.

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  3. ottnott

    For a very expanded explanation of what China is facing, read Michael Pettis’ blog piece: a href=”http://blog.mpettis.com/2016/06/rebalancing-wealth-transfers-and-the-growth-of-chinese-debt/”>Rebalancing, wealth transfers, and the growth of Chinese debt.

    Warning: the time you will need to read may exceed the average holding time for some of the traders on this board.

    The critical paragraph is this:
    Clearly the more wealth is transferred to the household sector, or the more Beijing is willing to allow the economy to slow, the more stable is China’s economic adjustment and the less painful economically over the long term. Greater transfers and slower growth, however, both come at the expense of the vested interests who oppose the reforms, and so it is politics, more than economic logic, that will determine the success of China’s rebalancing strategy.

    Pettis believes that, to avoid a really painful crisis, China needs both to allow growth to slow a great deal and to begin significant wealth transfers to households. He further believes that both of those needs will face very strong opposition.

    Pettis’ piece is very useful, I believe, because it provides a good explanation of the difficult situation China is in and it because it also provides us something to watch for to evaluate whether or not China has decided to face its problem while there is still some hope to manage it rather than just to suffer it.

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    • ottnott

      Sorry, I messed up the link:
      Rebalancing, wealth transfers, and the growth of Chinese debt.

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      • scottbot

        That link triggered my Norton antivirus block. Danger, Will Robinson.

        Although it would be hilarious if China was the only one that managed to navigate this obscene gap between haves and have nots. Maybe those death vans work.

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    • frog

      Interesting, Ott. Thanks for the article and the quoting of the critical paragraph.

      One strange thing about China that I got to know about from a friend who lives there, is that they have more money per household than they seem to. There is apparently a large under the table economy there. Almost everybody he knows is taking small “bribes”, or is getting kickbacks from people whom they choose for their company to do business with, or is running a Chinese food stand that they don’t have a business license for and for which they don’t pay taxes on the income.

      I guess it’s like a 3rd world country in that respect– that a lot of the time when you want to get something done, you have to pay someone off.

      So, along with all these exhortations that China’s economy is doing worse than it looks, there is also a distinct possibility that it is doing better than it looks.

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  4. it is showtime
    it is showtime

    Roarin’ Shamley

    I’ll start a savings acct for sure at an institution named Roarin Shamley

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  5. badduck

    TLT looks great right here at 143.30. What could happen.

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