Opinion – The Hidden Debt Burden of Emerging Markets by Carmen Reinhart – Project Syndicate – John Gelmini

Irish version of a 1939 British poster, create...

Irish version of a 1939 British poster, created in response to the 2010 Irish banking crisis (Photo credit: Wikipedia)

Like Dr Alf, I am optimistic too because as the Chinese ambassador said last night on Channel 4 whilst making mincemeat of the left-wing news presenter Jon Snow, the fundamentals of the Chinese economy were strong.

The last banking crisis was, of course, an engineered collapse, designed to look like something that the public throughout the world had caused through their own profligacy supposedly egged on by bankers recklessly lending money to people with no prospect of repayment.

This is why before the crisis there was plenty of money but during it there was supposedly none followed by a situation in which the top 1/10th of 1% of people suddenly doubled their money and had it all transmuted into gold bullion, buy to leave properties, fine art, gems and expensive real estate.

There will be a repeat of this at some future point but the Chinese are better prepared than they were the first time as are many of the developing countries.

This does not mean that the financial wolves have been bested but since more people know who they are,how they operate and to a certain extent how they think the road ahead for them is a little harder although the right wars, provided that they are containable, can provide the opportunity they seek.

John Gelmini