Michael Pettis's Contributions

Although I think China is clearly much more integrated as an optimal currency zone than Europe is today, it is probably less integrated than the US (I will use the US and Europe as the two extreme cases between which China falls). China of course does not have the problems of multiple sovereignty...

After last week’s tumultuous markets one of my clients sent me an email saying “I am so relieved your constant talk about worsening imbalances kept us from getting too complacent. Things really are as bad as you keep saying.”

This may be excessively optimistic on my part, but there seems to be a slow change in the way the world thinks about reserve currencies. For a long time it was widely accepted that reserve currency status granted the provider of the currency substantial economic benefits.

My last blog entry inspired an old Brazilian friend of mine, with whom I hadn’t had any contact for years, to comment on this section of the interview...

I have always thought that the soft landing/hard landing debate wholly misses the point when it comes to China’s economic prospects. It confuses the kinds of market-based adjustments we are likely to see in the U.S. or Europe with the much more controlled process we see in China.

Once again I am going to discuss debt, and my discussion will be mainly conceptual. I suspect that many of my regular readers might wonder why I keep returning to this subject – and, often enough, keep saying the same things.

From the early 1980s until now China has grown at a pace not matched since the four decades Argentina enjoyed before the First World War. In spite of some fairly goofy attempts a few years ago, however...

It might seem almost churlish to wonder what would happen if Spain were to leave the euro. The official European position is that the battle of the euro has been pretty much won, and anyone who argues otherwise will be accused of being a euro hater, an Anglo-Saxon or, even worse, a writer for the Financial Times.

We recently interviewed the esteemed economist and financial strategist Michael Pettis out of Beijing regarding the ongoing debate of whether China will see a massive credit crunch or growth collapse.

Debate about the global savings glut hypothesis is mired in confusion, a fundamental one of which is the seemingly obvious but false claim that a global savings glut must lead to higher global savings.

A new study complied by the World Bank has generated some pretty excited and, to some, alarming headlines about the new world order. There has been limited reference to this in the Chinese press, for reasons I will discuss...

I don’t often make reference to these kinds of things in my blog, but Saturday’s terrorist attack in the Kunming train station – in which 29 innocent people were hacked to death (the toll was especially high among the elderly who...

I got a lot of feedback from my January 5 blog entry because of my argument that the implementation of the reforms proposed in the Third Plenum all but guarantees that growth rates in China will slow down. For that reason I thought it might make sense for me to explain a little more carefully why...

Although still vague on the specifics, China’s Third Plenum November partially clarified the nature of the reforms that Beijing is proposing for China over the coming year. Of course very little was said in any of the related releases about the difficulties...

In order to understand much of what is happening in China I believe it is crucially important to understand how financial systems operate under condition of financial repression.

The past two years have seen a surprising amount of turmoil at the highest levels of the Chinese political establishment. We have seen political alliances re-shuffled, powerful business and political leaders arrested, factional disputes magnified, and an explosion of rumors of more to come.

Last month’s award of the Nobel Price in economics set off a great deal of chortling because one of the three recipients, Eugene Fama, received the award for saying that markets are efficient at capital allocation and another, Robert Schiller, received the award for saying they are not.

It seems to me that one of the automatic, if not always intended, consequences of Abenomics is to force up Japan’s current account surplus, and in fact to force it up substantially.