Author

Michael Pettis 118 posts 0 comments

Michael Pettis is a Senior Associate at the Carnegie Endowment for International Peace and a finance professor at Peking University’s Guanghua School of Management, where he specializes in Chinese financial markets. Pettis has worked on Wall Street in trading, capital markets, and corporate finance since 1987. Pettis is a member of the Institute of Latin American Studies Advisory Board at Columbia University as well as the Dean’s Advisory Board at the School of Public and International Affairs. He received an MBA in Finance in 1984 and an MIA in Development Economics in 1981, both from Columbia University. He writes the blog .

Economy

The debt-financed investments of Chinese state-owned enterprises

Michael Pettis Jul 7, 2011

A lot of Chinese SOEs are involved in a very wide variety of business activities, and are especially fond of activities in which cheap capital is the comparative advantage, or in which there is political advantage to be gained. That makes…

Economy

Small companies feel pain as China tightens

Michael Pettis Jun 28, 2011

Michael Pettis writes that in the current environment is that small and medium enterprises (SMEs) are hurting, and last week’s minimum reserve hike – which came out the same day as the CPI number – will undoubtedly make things worse since…

Monetary System

How to become virtuous and save more

Michael Pettis Jun 14, 2011

In this column, Michael Pettis uses Germany and Spain as examples of the interplay between savings rates, trade balances and economic policy. Looking at this interplay, it turns out that domestic policies by the German government can…

Markets

Trade and the RMB

Michael Pettis Jun 1, 2011

What is driving the increase in the RMB-denominated trade is probably not any preference to transact in RMB but rather speculative demand for RMB. That sounds pretty plausible.

Economy

Looking for debt

Michael Pettis May 26, 2011

An unsustainable rise in debt is, for me, one of the key indicators that the investment-driven model has passed its useful life and is generating negative growth while posting positive growth numbers. This is why I spend so much time trying…

Economy

China: rebalancing through wage increases

Michael Pettis May 15, 2011

Is China currently rebalancing? The currency has been appreciating, the PBoC has hiked interest rates four times, and wages have been surging. Because of all of this I am often asked if China has finally begun the long-waited rebalancing…

Economy

Is it time for the US to disengage the world from the dollar?

Michael Pettis May 2, 2011

Michael Pettis argues that Reserve currency status is a global public good that comes with a cost, and people often forget that cost.

Monetary System

Chinese recycling and US interest rates

Michael Pettis Apr 16, 2011

. If China’s current account surplus declines, there are, very broadly, two ways this can affect the US. On the one hand the surplus can simply be transferred to another country. For example if China’s current account surplus declines…

Economy

Reforming the banks

Michael Pettis Apr 7, 2011

By Michael Pettis I just got back from a very interesting but hectic week in New York and Washington, followed by two days at a conference in Hangzhou. During my meetings I noticed that much of the discussion, and many of the questions I…

Economy

Is loan growth in China slowing?

Michael Pettis Mar 24, 2011

The correct way to look at the causes of trade imbalances, in my opinion, is to look at policies that force up or down the savings rate, or the consumption rate (which is more or less the same thing since total savings is simply total…