CHINA IMPLOSION?

Australia is very trade exposed to China. We all know that. The weekend Australian Financial Review reported “…all of the necessary pre-conditions for a banking crisis of incalculable proportions are in place in China. The primary driver of an explosion in bad loans is an explosion in credit growth…..That is unsustainable and likely to come to a messy end….”

I was in Singapore at the height of the so-called Asian crisis in former years. I was the ONLY occupant of one the large hotels there. Is this what will happen in China and what will be the impacts on the world? We shall see.

In the meantime, my punt is on a US led recovery (more later) followed by recovery in German led Europe.