Business, Finance & Economics

China's markets

(What's the reaction despite the premier's proclamation?) There isn't really panic, overall people have faith in the government in their ability to shore up banks. The investment group says its payments will be affected this year but next year it will recover. The media has been downplaying the crisis. (If Americans aren't spending as much, then they can't be spending much on Chinese exports.) Absolutely, and that has been the cause of some concern. (Can you tell us how vulnerable the Chinese financial sector is right now and how that might affect the U.S. financial sector?) Something to keep in mind is that China is the second largest of U.S. Treasury bonds, second only to Japan, so it's not in China's interest to see the U.S. economy tank. But the U.S. has been shifting so it's not so reliant on China. so that's been a shrewd move of diversifying and China seems to realize that it can't rely on the U.S. for the long term.

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(This story is based on a radio interview. Listen to the full interview.)

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