rebalancing

I have decided to single Klaus Baader out for special treatment here because he conveniently brings together, in a clear and succinct fashion, a number of arguments which are widely accepted and used by both analysts and policy makers about…

The immediate problem is the excess capital investment and the costly maintenance of the projects it has spawned. Longer-term, Asia's growth prospects look good.

There is a difference between economic growth from mere factor mobilisation and economic growth from increased productivity. One requires a lot more capital investment and debt than the other. If and when capital investment growth slows,…

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…

. 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…

I don't think people realize that the Chinese have just made a rather sizable shift in economic policy. The Chinese are moving on multiple fronts now toward a new economic paradigm that includes slower growth but more domestic consumption.…

By Claus Vistesen As the debate between the inflationistas and deflationistas appears about to rev up again, I thought that I would try to put pen to virtual paper and sketch out my thoughts on the matter. The specific catalyst for…

By Michael Pettis On Friday the US Treasury released its presumably semi-annual (it was due last October) report to Congress on currency issues, and in it refrained from calling any of the countries under review “currency…

By Michael Pettis Most of this week’s newsletter was about the release last week of China’s fourth quarter GDP growth numbers by the National Bureau of Statistics (NBS). You can find the full NBS report on their website, but here is the…

by Michael Pettis Once again I am starting to hear investors tell me that they have been advised by bank analysts not to worry too much about the impact of a banking crisis in China.  According to this argument, China has developed a…