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A watershed moment in China ??

|Includes: CANL, Independence Community Bank Corp. (ICBC)

I came across a bloomberg article today

http://www.bloomberg.com/apps/news?pid=20601087&sid=aIcTfdm5rWdY&pos=2

 China is getting aggressive on all the debt taken on by local government Investment vehicles. Contrary to the speculations of few in the western media, the Chinese administration seems to be serious about the hidden debt problem and wants to act now irrespective of their leaders term. This, along with credit tightening could very well tun out to be a watershed moment  for Chine.

May be this is the difference. One one hand you have the West ( US in particular ) where everybody thinks the debt is not their problem and they are more than willing to kick the can down the road. They continue borrowing and delaying the inevitable.

On the other hand you have China, where the regime knows it is the one thats going to be in power and would have to face bigger problems in the future if they decide to push the adjustment later. 

 One of the shortcomings of Democracy??...where people want no cuts in spending, pensions, entitlements, other benefits and no increase in taxes but at the same time want lower deficits !!!









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