Is China at Risk of Defaulting?
One calculation puts China's sovereign debt at 150 percent of its G.D.P., a bigger percentage than Greece's. As China is buying up more European debt, could it be at risk of defaulting?
What's the Latest Development?
Chinese Premier Wen Jiabao travelled to Europe recently to reassure his country's biggest trading partner that China will not stand idly by as European economies struggle under the burden of Greece's imminent default. $2 billion in trade deals were signed in London while Germany, China's biggest trading partner in Europe, made out even better with $15 billion in trade contracts. But it was not all for Europe's benefit, of course. Of China's $3 trillion currency reserve, a quarter is held in European bonds.
What's the Big Idea?
Considered to be an economic behemoth, few have asked after China's debt which, depending on how it is measured, accounts for between 60 to 150 percent of G.D.P. While China's economy is doing better than most, it's long term welfare depends on market liberalization, says Victor Shih, professor of political science at Northwestern University: "When we take into account all the liabilities of state-owned enterprises, [national debt] comes out to be over 150 percent of the Chinese economy. ... There is a huge amount of inefficiency in the economy which will create a big drag on the Chinese economy going forward."
Malcolm Gladwell teaches "Get over yourself and get to work" for Big Think Edge.
- Learn to recognize failure and know the big difference between panicking and choking.
- At Big Think Edge, Malcolm Gladwell teaches how to check your inner critic and get clear on what failure is.
- Subscribe to Big Think Edge before we launch on March 30 to get 20% off monthly and annual memberships.
It's one of the most consistent patterns in the unviverse. What causes it?
- Spinning discs are everywhere – just look at our solar system, the rings of Saturn, and all the spiral galaxies in the universe.
- Spinning discs are the result of two things: The force of gravity and a phenomenon in physics called the conservation of angular momentum.
- Gravity brings matter together; the closer the matter gets, the more it accelerates – much like an ice skater who spins faster and faster the closer their arms get to their body. Then, this spinning cloud collapses due to up and down and diagonal collisions that cancel each other out until the only motion they have in common is the spin – and voila: A flat disc.
It's not just a case of "what doesn't kill you makes you stronger."
- A new study suggests children who endure trauma grow up to be adults with more empathy than others.
- The effect is not universal, however. Only one kind of empathy was greatly effected.
- The study may lead to further investigations into how people cope with trauma and lead to new ways to help victims bounce back.
Do you have a magnetic compass in your head?
SMARTER FASTER trademarks owned by The Big Think, Inc. All rights reserved.