BLOOMBERG: Is China Credit-Bubble About To Burst - VIDEOSubmitted by emalvini on Tue, 06/18/2013 - 22:01
BLOOMBERG: Is China Credit-Bubble About To Burst - VIDEO
By Bloomberg News | May 29, 2013 | 3:20 AM PT
Chinese banks are adding assets at the rate of an entire U.S. banking system in five years. To Charlene Chu of Fitch Ratings, that signals a crisis is brewing.
Total lending from banks and other financial institutions in China was 198 percent of gross domestic product last year, compared with 125 percent four years earlier, according to calculations by Chu, the company’s Beijing-based head of China financial institutions. Fitch cut the nation’s long-term local-currency debt rating last month, in the first downgrade by one of the top three rating companies in 14 years.
“There is just no way to grow out of a debt problem when credit is already twice as large as GDP and growing nearly twice as fast,” Chu, 41, said in an interview.