A Crisis Deepens?

The People’s Republic of China has a serious debt problem, but its economy is still slowing (note, though: slower growth still is growth).  To try to control and reverse the trend, the PRC’s central bank is lessening capital requirements for the nation’s banks, pumping more money into the financial system, and urging commercial lenders to offer more loans at cheaper rates to small businesses.  Their answer to too much debt seems to be to pile on more debt, lower the backstop against failing loans, and devalue through inflation the currency needed to repay the debt.

Another day older and deeper in debt.
St Confucius, don’t you call me ‘cos I can’t go,
I owe my soul at the Chairman’s call.

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