For all the bailouts, nationalizations and support packages being offered by governments around the world, it is becoming increasingly apparent that there can be no return to the credit bubble of the past. Even if banks are provided with all the liquidity they could hope for at zero interest rates, it makes no sense to lend to companies struggling to survive a recession. Banks already have enough bad debts.rnInstead, the world is going into reverse. And while it is in no way China's fault, the bouyant export markets they have become accustomed to are disappearing. If it had one benefit, the reckless expansion of private credit in the west helped millions of Chinese out of poverty to such an extent that the country has become a key player in world energy markets. It is, or was, the marginal buyer of fuel oil along its southern coast to meet annual power shortages for its manufacturing industries. It is, or was, a swing exporter/importer in the thermal coal market. It is, or was, one of the world's fastest growing markets for natural gas. China is, or was, slated to account for a huge share of future energy demand and emissions.
展开▼
