According to CBC news’ Economic Analyst Don Pittis, China’s own internal crisis may spark a change in the Global Economy. He believes the results are not as positive as anyone would think.
Mr Pittis said that analysts see climbing stock markets have shown an “ominous feeling of escalating pressure” that may need a crisis to bring things back to balance. He stressed that if China would take one for the team, they can be the biggest catalyst.
Billionaire investor George Soros said that China might be getting itself into or is priming itself for a possible storm.
“I think there’s an eerie resemblance of what’s happening in China to what happened here leading up to the financial crisis, 2007-2008,” Soros said during an Asia Society event in New York earlier this year. “It’s similarly fuelled by credit growth and an eventually unsustainable expansion of credit.”
The International Monetary fund had expressed its own concern about China’s “unsustainably high growth targets” which endanger companies that may default on loans and create a “difficult landing” when the bubble bursts.
Chinese media had reacted negatively to Mr Soros and the IMF’s analysis with provocative editorials reading about the west declaring war on China’s currency.
The country is also convinced that the Sept 4 and 5 summits would tackle not its unscrupulous activities in the South China Sea but rather its economic travels that affect many markets the world over.
China’s market is seeing difficulty but it does not mean that its factions are not open to experimentation. However, Mr Pittis said the various methods used are still dependent on the personal power of individuals and it can yet allow the country to reach equilibrium.