Xie: How China Became Paralyzed, and What It Means

The latest from Andy Xie, this time on how China has become paralyzed from a policy point of view, and what it means:

Powerful interest groups have paralyzed China’s macro-economic policy, with ominous long-term consequences. Local governments consider high land prices their lifeline. State-owned enterprises don’t want interest rates to rise. Exporters are vehemently against currency appreciation. China’s macro policies have been reduced to psychotherapy, relying on sound bites and small technical moves to scare speculators. In the meantime, inflation continues to pick up momentum. Unless the central government bites the bullet and makes choices, the economy might experience a disruptive adjustment in the foreseeable future.

More here.


  1. Grade A stuff. I’m uqnuetsoianbly in your debt.