China’s current financial crisis is the combination of two moves that have sparked mayhem. And while it’s hurt one Aussie industry, another is thriving.
Over three decades, China has steadily opened up its economy to the influences of markets to advance human utility.
Over that period it has always been careful to try to avoid the financial excesses that overtake capitalism from time to time. On this basis, after the Global Financial Crisis (GFC), Beijing expressly eschewed the Western model of over-liberalisation and financialisation.
For instance, China was never so foolish as to let Wall Street bankers loose in its mortgage market, as the US had done in the post-millennium period, resulting in the greatest mortgage bond and property price bubble and bust in history. Equally, China has been very cautious in freeing up its interest rate markets and currency, preferring to keep them largely under centralised control.
But, for all…