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Financial markets

Does it matter if China cleans up its banks?

31 August 2016

By Michael Petts I’ve always thought that Shirley Yam of the South China Morning Post has a great nose for financial risk, and this shows in an article she published last week on mainland real estate. For anyone knowledgeable about the history of financial bubbles and crises, much of the [read more]

Rebalancing, wealth transfers, and the growth of Chinese debt

22 June 2016

Michael Pettis For the past ten years much of what I have written about debt in China was aimed mainly at trying to convince analysts and policymakers that the Chinese economy was structurally dependent on an unsustainable increase in debt in order to generate GDP growth rates above some level. [read more]

China’s rebalancing timetable – Michael Pettis

29 November 2015

By Michael Pettis · November 29, 2015 We often read in the press rather alarming stories about the rise of an ugly and belligerent nationalism in China, but while these stories are certainly very real, after the November 13 bombings in Paris I was struck by a very different kind of Chinese [read more]

Thin Air’s money isn’t created out of thin air

19 October 2015

Michael Pettis A recurring conversation I have with clients concerns the ability of banks to create credit, and of governments to monetize debt, and whether this ability is the solution to or the cause of financial instability and economic crisis. Monetarists and structuralists (to use Michael [read more]

Do markets determine the value of the RMB?

18 August 2015

By Michael Pettis · August 18, 2015 Last Tuesday the PBoC surprised the markets with a partial deregulation of the currency regime, prompting a great deal of discussion and debate about the value of the RMB. Part of the discussion was informed by a consensus developing in one part of the market [read more]

Interpreting information in China’s stock markets

28 July 2015

Michael Pettis, published 17 July 2015 Anyone who reads my blog is already likely to know the story. Until the market peaked on June 12, with the Shanghai Composite at 5,178, China had experienced a stock market boom that saw the Shanghai index rising in what seemed like a straight line by more [read more]

Internal and external balance

28 July 2015

Michael Pettis, 9 June 2015 I was recently asked by an Australian economics journal to write a review of a book I had already read,The Leaderless Economy, by Peter Temin and David Vines (published in 2013). Because the book is a great place from which to start a discussion on the links within [read more]
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