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China skepticism from the Econ. 5/21 to add to the robust Caps China debate

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May 21, 2009 – Comments (0)

 Banyan

May the good China preserve us

May 21st 2009
From The Economist print edition

China is enjoying its new prestige as a global economic helmsman, but it still has problems at home

THE sense that someone else’s loss is your gain, leading even to rejoicing at their disaster—xing zai le huo—is as hard-wired into the Chinese psyche as anywhere. Honed by American policymakers’ past fondness for hectoring China about the need for better risk-management and exchange-rate flexibility, this emotion has come to the fore since the United States was overtaken by financial calamity. China’s leaders are at pains to show their increasing sophistication, so public dancing around the corpse of the American financier is frowned upon. But many Chinese think their country is having a rather good crisis. 

[...]

If domestic demand is to grow, then finance has to be liberalised to allow savers to earn an honest return and deserving companies to get finance. But this would be to challenge the state’s chief powers, which is why it will happen only slowly, if at all. In the short run, the government may either tolerate the speculative fires the stimulus is igniting, or douse them by tightening credit. Either way, China’s leaders will be too busy saving China to bother about running the world. 

(Please, read the full one page article at the link below-Alex) 

http://www.economist.com/world/asia/displayStory.cfm?story_id=13701737&fsrc=nwlbtwfree

(Rather good article here. More skeptical about China's short term economic prospects and long term super power ambitions than me but still a good read. I particularly do not agree with that last sentence)

Best to all

Alex 

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