China has had 35 years of hypergrowth, but now it’s over. It’s going to have to settle for really, really good growth instead.
But that’s still going to be hard now that fewer Chinese are working-age, fewer people are moving to the cities and, most of all, now that China has a debt bubble it’s trying to deflate without bursting its economy as a whole.
Specifically, the PBOC will let banks loan out more of their money and give them cheap loans in return for local government debt. This sure looks like China is stepping on the monetary gas to try to keep economic growth, which has already slowed to a six-year low
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