CHINA'S BUBBLE

Alexandru-Ioan Milosan

Academica Science Journal, Economica Series, 2013, vol. 2, issue 3, 34-39

Abstract: This document contains information on the China's Bubble. A "bubble" in economic terms refers to a situation in which asset prices appear to be based on implausible or inconsistent views about the future. When the prices of securities or other assets rise sharply at a sustained rate then they exceed valuations justified by fundamentals, making a sudden collapse likely; at which point "the bubble bursts". With a high percentage of debt and nonperforming loans the question is, not if the Chinese government will offer to bail out the banks and the state owned companies, but rather if it has sufficient resources to do so; and if it does have sufficient resources to bail can it then recover from the shock and continue its economic grow as it has in the last decades.

Keywords: China; economic model; bubble; trade; nonperforming (search for similar items in EconPapers)
Date: 2013
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