China's Cash Crunch

Discussion in 'Wall St. News' started by dealmaker, Aug 7, 2019.

  1. dealmaker

    dealmaker

    China's Cash Crunch


    A cashflow problem at many of China's private businesses is adding up to a growing glut of IOUs—or commercial acceptance bills—largely due to banks' reluctance to lend to smaller, private companies. Those IOUs now total an estimated $200 billion. Past experience suggests this will go badly: 20 years ago, those notes added up to $86 billion, or a fifth of the Chinese economy, spurring a debt crisis that eventually spiraled and required government intervention. New York Times