Monday, June 25, 2007

Paper Dragon

Readers of this blog already know the REcapitulators opinion of China.  Now, the Bank of International Settlements weighs in with a good rendition of the "somewhat" obvious...

The Chinese economy seems to be demonstrating very similar,
disquieting symptoms," it said, citing ballooning credit, an asset
boom, and "massive investments" in heavy industry.

Some 40pc of China's state-owned enterprises are loss-making,
exposing the banking system to likely stress in a downturn.

It said China's growth was "unstable, unbalance, uncoordinated and

Still Communist.  Still Centrally Planned. Still harboring great masses of people that have no access.  Hayek's "The Fatal Conceit" contained all of the intellectual groundpinnings for the refuation of such a plan.

Now let's add massive corruption and near institutionalized cronyism, which appear to be invevitable evolutionary appendages to Communism, and you have the paper dragon of China.

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