The problem is that the lending never stopped. As the West confronted its financial reckoning in 2008, China, where 30 million people swiftly found themselves out of work, ordered its banks to stimulate the economy through all-out lending. Instead, it is a work of highly engaging reportage unmistakably clear in its implications. What’s different is that this book has neither the empty flash of the commentator’s talking points or the numbing certainty of an IMF report. McMahon, a former correspondent for the Wall Street Journal, is far from the first skeptic of China’s decade of debt-fueled growth. Reading Dinny McMahon’s China’s Great Wall of Debt provokes the same uneasy recognition as Demon did that the jig is up. Its author, a former Wall Street insider, wrote a vivid and damning account of an industry whose fetishization of complexity and incentive structure, instead of managing risk, was amplifying it. Review of China’s Great Wall of Debt: Shadow Banks, Ghost Cities, Massive Loans, and the End of the Chinese Miracle by Dinny McMahon. Houghton Mifflin Harcourt, 2018.Ī year before the financial crisis struck in 2008, A Demon of Our Own Design was published.
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