Abstract
China’s binge investments since 2008 have racked up a huge amount of debt in its financial system. Much of it went for fixed asset investments, especially property development. This raises the concern that if the Chinese property bubble was to burst, it could lead to a Minsky moment (see below), followed by a devastating Lehman moment and a financial collapse.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Bibliography
McKinsey Global Institute, Debt and (Not Much) Deleveraging, P. 75, Feb 2015.
Hyman Minsky, The Financial Instability Hypothesis, Working Paper #74, P. 7, Levy Economic Institute of Bard College, May 1992.
Hyman P. Minsky, Distinguished Scholar, Levy Economics Institute of Bard College, www.levyinstitute.org, reviewed Jun 2015.
Wayne Ma and Emily Glaser, Suntech Is Pushed Into Chinese Bankruptcy Court, The Wall Street Journal, Mar 20, 2013.
Katy Stech, China’s Suntech Power Plans U.S. Bankruptcy Filing, The Wall Street Journal, Jan 31, 2014.
David E. Rovella, Bankrupt Solar-Panel Maker Suntech Seeks Court Protection, Bloomberg News, Feb 22, 2014.
Suntech Company Reports, reviewed Feb 2015.
Rick Barrett, No Layoffs at Nucor Despite Bad Economy, Milwaukee Wisconsin Journal Sentinel, www.jsonline.com, May 22, 2010.
Official Reserve Assets, Foreign Currency Reserves, safe.gov.vn, reviewed Jan 2106.
List of countries by home ownership rate, Wikipedia, reviewed December 2015.
Xing Yun, Zero Bailout Policy for Local Gov’t Debt Leaves Doubts, CaixinOnline, Oct 9, 2014.
Don Weinland, China Approves Second Batch of Asset Management Companies, South China Morning Post, Nov 25, 2014.
Li Xiang, More Local Govts Allowed to Establish AMCs, China Daily, updated Nov 26, 2014.
Central Intelligence Agency, The World Factbook, Country Comparison: Public Debt, Jan 2.
Jack Perkowski, China’s Debt: How Serious Is It? Forbes, Jan. 21, 2014.
The Economist, Local-Government Debt, Counting Ghosts, China Opens the Books of Its Big-Spending Local Governments, Jan 4, 2014.
Chen Weihua, China’s Local Government Debt in Spotlight, China Daily, Nov 29, 2014.
Lu Jianxin and Gabriel Wildau, Reuters, China Issues Rules to Limit Bond Investment by Shadow Bank Products, Feb 13, 2014.
Bloomberg News, First China Onshore Default Looms as Chaori to Miss Payment, March 5, 2014.
Grace Zhu, Lingling Wei and Wynne Wang, China’s Huatong Road & Bridge Avoids Bond Default, The Wall Street Journal, Jul 23, 2014.
Local government debt in spotlight, China Daily, Nov 29, 2014.
The Wall Street Journal, Shadow Lender Strives to Avert Loss, Lingling Wei, Jan 27, 2014.
Bloomberg News, China Credit Repays Principal to Bailed-Out Trust Holders, Jan 30, 2014.
Kate Mackenzie, Moral Hazard, the Chinese Way, FT Alphaville, Aug 19 2013.
Jack Perkowski, China’s Debt: How Serious Is It? Jan 21, 2014.
Grace Zhu, Lingling Wei and Wynne Wang, China’s Huatong Road & Bridge Avoids Bond Default, The Wall Street Journal, Jul 23, 2014.
Bloomberg News, China Credit Repays Principal to Bailed-Out Trust Holders, Jan 30, 2014.
Shen Hong, China’s Shadow-Banking Boom Is Over, The Wall Street Journal, Dec 23, 2014.
Kate Mackenzie, Moral Hazard, the Chinese Way, FT Alphaville, Aug 19 2013.
Reform of State-owned Enterprise in China, China Labor Bulletin, last updated Dec14, 2007.
Prudence Ho, Investors Pile into Cinda IPO, The Wall Street Journal, Nov 24, 2013.
General Motors Chapter 11 reorganization, Wikipedia, reviewed June 2015.
Wikipedia, List of Countries by Home Ownership Rate, reviewed December 2015.
Shanghai Stock Exchange website, reviewed January 2016.
National Bureau of Statistics of China website, reviewed January 2016.
Author information
Authors and Affiliations
Rights and permissions
Copyright information
© 2017 The Author(s)
About this chapter
Cite this chapter
Yen, W. (2017). Moral Hazard or Moral Imperative?. In: From the Great Wall to Wall Street. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-33008-2_11
Download citation
DOI: https://doi.org/10.1007/978-3-319-33008-2_11
Published:
Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-33007-5
Online ISBN: 978-3-319-33008-2
eBook Packages: Business and ManagementBusiness and Management (R0)