This is a useful read from Reuters on the difficulties China is facing, pushing on a string.
China is awash with money and its growth is slowing. To avert a prolonged stagnation, President Xi Jinping’s administration may need to spend its way out of the problem. Yet this and other classic remedies to such a malaise may not be effective in Beijing’s “socialist market economy”.
China’s condition may be seen as what economists call a liquidity trap, though the term means different things to different people.
Regardless of your view on China, this is a good learning piece. Recommended.
This article was written by Eamonn Sheridan at www.forexlive.com.
