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China, like Japan in the 1990s, Will Be Dominated by Huge Zombie Banks
Michael Pettis has some words of wisdom for those who believe China will soon overtake the US as the world leader. "Having the smaller banks absorbed by the bigger ones, which seems to be Beijing's new strategy, will mean that China, like Japan in the 1990s, will be dominated by huge zombie banks," says Michael Pettis at China Financial Markets in a series of Tweets. The Tweets were in reference to the Wall Street Journal article Why China’s Smaller Banks Are Wobbling. China’s banks come in various flavors. There are a handful of giants, and a few more medium-size banks that can also operate nationally. Below that ... (full story)