Does China need a recession?
It is getting interesting. Attention has been focused since August 11 on the unsustainable nature of the Chinese problem. What China needs, given the over-investment in non-productive assets estimated at $1.7 trillion a year for several years, is a deep recession, the writing off of several trillion dollars of debt and the refinancing of the banking system. You cannot do all that without interest rates at almost zero and a weak exchange rate. Read more