The foundation our government built its financial house of cards on was made of gray painted foam instead of concrete?
Billions of dollars of debt racked up by local Chinese governments during their investment sprees are likely to sour as the projects they finance near completion, Yin Zhongqing, a prominent Chinese lawmaker, said this week.
In an interview with Reuters Insider, Yin said local governments had incurred at least 10 trillion yuan ($1.5 trillion) of “hidden” debt, which they have concealed by creating thousands of investment vehicles that serve as borrowers.
Probably little will come of this. If China starts calling in it’s markers on us, they’ll damage our country, which will reduce the amount of their exports we can buy (exports that the rest of the world is unable to absorb), which will in turn hurt their economy.
Trade cuts both ways.