主题：【原创】茗谈（95）：织锦 -- 本嘉明

predicted based on certain assumptions. It is true that a country with 30-40% non-performing loan ratio in 1990s will find it difficult to maintain the system. But those assumptions do not play out in 1990s.

Last time, America served as the savior: it opened its domestic market to let in China's import, it also started a dot.com revolution so that excess capital find places to invest--rather than wasting on unproductive real estate speculation. European market also serves as a healthy outlet for China's exports.

China was rescued last round by a very open external market and its PRIVATE export sector, NOT the 管办经济。

It no longer has such a luck this time. Its 2011 non-performing loan ratio has reached historical lowest point in its own history, it is even lower than in some of the best countries on the earth, such as Switzerland and Canada in 2011. I want to point out the 2007 level was around 7%--that's more normal for China given its inefficient state sector.

China's economy is so large now: it is more costly and DIFFICULT than in the past for gov.-managed stimulation or manipulation.

China's export sector is dying, real estate speculation being hovering in the sky. There was lots of waste of infrastructure investment between 2009-2012. All will come back and show its impact in the banking sector.

let's wait and see. I think it will take 3 years before China's gov. even admits this souring banking problem in its own media.

Before that, we were like America in early 2006.

YOU MENTIONED INFLATION IS THE BEST CURE. AGREE. FED UNDER BEN IS DOING THE SAME THING NOW. But what you prefer is a CONTROLLABLE mild inflation over 10 years. It is not easy to control inflation in China: it is either too high or too low. PBOC needs to be a good student of Fed for a few more decades.