India’s debt problems go back a long way, and there are significant governance issues, including at state-owned banks.
China’s debt situation isn’t a lot different to India’s, but the acceleration of loans and credit growth in China is very fast
It’s not just the debt level in China that is worrisome, but the speed that it’s accumulating; maybe some of these loans won’t be repaid or serviced.
We don’t have a liquidity problem that central banks can solve - if we have too much debt, we have a debt resolution or insolvency problem and only governments can address problems like that.
World needs more fiscal expansion, structural reforms, and also have to look closely at debt write-off some of it and maybe recapitalize financial institutions.
We have got the mix of income that goes to capital versus labor wrong in many countries, and we need to look at that.
Central bank tightening is inevitable, but have to be careful.
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