An SVG map of China with Beijing municipality highlighted Legend: Image:China map legend.png (Photo credit: Wikipedia)
This is an excellent article by Simon Rabinovitch, FT correspondent in Beijing, China. Check it out!
Personally, I was enormously impressed with the Chinese Government’s intervention in 2008 in response to the global banking crisis. I sense that the Chinese Government might be biding its time waiting to intervene aggressively, once again.
At one extreme, the Chinese Government may stimulative domestic demand with capital investment and at the other it may acquire European assets at fireside prices.
How do you see the Chinese Government responding over the next six months?
They will do both but they will not hand europe a blank cheque.
What the head of the Chinese Sovereign Wealth Fund has said in very direct language is that European leaders must stop dithering, execute a proper plan for reform and then improve its financial condition.
This would be one of the preconditions for Chinese aid and, in addition, Chinese “help” would involve the acquisition of tangible assets like banks and infrastructure.
The Chinese will open their wallets in their own interests not those of the FT and those who have not woken up to the fact that they cannot just ask all and sundry to jump any more.
Thanks John. Agree with you completely!