China’s Economy: Evergrande a canary in the coal mine?
One Decision
00:00
How Does the Chinese Government Deal With the Right Offs?
Last year we saw three point one trillion remi b in right offs. That's almost 500 billion us Dollars. So they are quietly in the background, working off a lot of this bad debt. The question just becomes, this all works when the economy is growing really rapidly and banks are earning enough money to write the stuff off. But if growth slows, bank earnings slow, they don't have as much capacity to write thestuff off,. And we've still got big losses. that's when it gets more tricky.
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