Fed Chairman Ben Bernanke has taken a lot of heat for printing money, even being dubbed "Helicopter Ben" by his critics, a metaphorical reference to showering the U.S. economy with money. But if Bernanke's making it rain from a helicopter, China's been bombarding its economy from multiple stealth bombers. Money supply rose markedly in May and recent years' credit growth has surpassed even that of the U.S. in the period leading to the Lehman collapse.
Unfortunately, instead of being put to good use, much of that money has ended up in the hands of wasteful state-owned enterprises, or SOEs. Meanwhile, cash-starved private entrepreneurs have watched quietly from the sidelines, unable to participate in Beijing's ragin', capital-misallocatin', credit-fueled investment boom. Is this another sign of the unsustainability of Chinese growth?
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