A new year in China brings a different bubble
by Craig Stephen
HONG KONG (MarketWatch) — As concerns over China are not going away, it’s worth considering what assets are likely to be affected if it is finally forced to call time on its debt spree.
For now, opinions on China’s outlook remain divided, with it being just as easy to point to areas of its economy that are still ticking along nicely, as to others that have already landed hard. Alongside the drumbeat of bad news from distressed heavy or commodity industries, there is still upbeat growth in developing service, digital and various consumer sectors.
One way to navigate these conflicting signals is to follow the money. That is to see where China’s prodigious credit growth — which in March effectively tripled over a month earlier — is causing the most distortions.