China's cash reserves have grown considerably. It's probably the only country with sizable reserves. And it's financed by household debt. this is slightly different from other economies, where both nation and populace are indebted – but nonetheless a concern. Further, the Chinese government is in practice not as democratic as it would like to have its reputation stand. This is a tight control of power… and one on which the world hangs.
The implication is that when a reversal comes, it will hit not just one regional economy, but the global economy. And a reversal is a time of hardship as the economy realigns and resets itself. We've never had a simultaneous world economic reset – but it surely won't be easy. It'll be interesting to watch how things play out. I don't agree that a reset will come in 2014 – in particularly considering the source of this post – but it's certainly a daunting thought that a global reset is due, sometime sooner rather than later.
Activist Post: China Is On A Debt Binge And A Buying Spree Unlike Anything The World Has Ever Seen Before
You read that right: in the past five years the total assets on US bank books have risen by a paltry $2.1 trillion while over the same period, Chinese bank assets have exploded by an unprecedented $15.4 trillion hitting a gargantuan CNY147 trillion or an epic $24 trillion – some two and a half …