Summary of Finance Should Return to Common Sense, Original Purpose

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The International Monetary Fund expects China to remain the world economy’s biggest source of growth through at least 2027. While the Chinese economy continues to grow, experts inside and outside China are increasingly worried about the country’s high debt levels and the risk of a collapse in asset values. An editorial by the media portal Caixin Global explains the roots of China’s heightened financial risk and calls for wide-ranging regulatory reforms to contain it. getAbstract recommends the succinct essay to professionals in the financial industry.   

In this summary, you will learn

  • Why China faces increased financial risk despite strong economic fundamentals and
  • What measures China must take to mitigate the risk of an economic crisis.
 

About the Author

Caixin Global is the English-language portal of China’s financial media group, Caixin Media.  

 

Summary

The governor of China’s central bank, Zhou Xiaochuan, warned in late 2017 that the country was facing considerable financial risk. High leverage is the cause of the Chinese financial system’s vulnerability. In 2016, China’s ratio between total debt and total assets was at 247%, a level commonly considered dangerous.


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