If the United States relies on China as its main lender, what happens when China is having difficulties with its debt?
We may soon find out. As the Financial Times reported, “several banks have had to delay or dramatically reduce Chinese bond issues as the impact of a tight onshore credit market begins to be felt.”
Zerohedge noted that Chinese bond issuers are dealing with the drying up of interbank market liquidity, increased competition from wealth management and trust products, and other problems. At the same time, one analyst said, “China is much more funding dependent than in the past.”