China’s Markets Are Very Unstable. Its ‘Shadow Banks’ Are Not Helping.

Big Think's chief economist discusses the fledgling Chinese shadow banking system that national leaders want to regularize.

Daniel Altman: For many years financial markets have been regulated in terms of the amount of interest that can be charged on loans and the types of securities that can be offered by different entities whether loans have collateral or not. All of those things are heavily regulated in China. And this has led to what’s called a shadow banking system where there are billions and billions of dollars being lent out through non-bank institutions to make business possible where the supply of regulated credit is insufficient. China wants to regularize this shadow banking industry. It wants to bring it into the formal sector, but to do that they’re gonna have to slowly start to liberalize these other regulations that have been constraining that sector. And this could be quite a disruptive process because every time they liberalize one of the asset classes, a certain type of loan or security, all of the returns on that asset class will change and there will be shifts in where credit is available in the market. This is part of their overall economic reform plan; it’s part of what they’re seeking to do to open up their capital markets further to make their currency a convertible currency that can be used freely in international markets and move across its borders freely. But it’s going to take time and it will have disruptions along the way.

Big Think's chief economist discusses the fledgling Chinese shadow banking system that national leaders want to regularize.

Develop mindfulness to boost your creative intelligence

Sharon Salzberg, world-renowned mindfulness leader, teaches meditation at Big Think Edge.

Image: Big Think
Big Think Edge
  • Try meditation for the first time with this guided lesson or, if you already practice, enjoy being guided by a world-renowned meditation expert.
  • Sharon Salzberg teaches mindfulness meditation for Big Think Edge.
  • Subscribe to Big Think Edge before we launch on March 30 to get 20% off monthly and annual memberships.
Keep reading Show less

Why modern men are losing their testosterone

Research has shown that men today have less testosterone than they used to. What's happening?

Flickr user Tom Simpson
Sex & Relationships
  • Several studies have confirmed that testosterone counts in men are lower than what they used to be just a few decades ago.
  • While most men still have perfectly healthy testosterone levels, its reduction puts men at risk for many negative health outcomes.
  • The cause of this drop in testosterone isn't entirely clear, but evidence suggests that it is a multifaceted result of modern, industrialized life.
Keep reading Show less

For a long time, the West shaped the world. That time is over.

The 21st century is experiencing an Asianization of politics, business, and culture.

Videos
  • Our theories about the world, even about history or the geopolitics of the present, tend to be shaped by Anglo perspectives of the Western industrial democracies, particularly those in the United States and the United Kingdom.
  • The West, however, is not united. Canada, for instance, acts in many ways that are not in line with American or British policies, particularly in regard to populism. Even if it were united, though, it would not represent most of the world's population.
  • European ideas, such as parliamentary democracy and civil service, spread across the world in the 19th century. In the 20th century, American values such as entrepreneurialism went global. In the 21st century, however, what we're seeing now is an Asianization — an Asian confidence that they can determine their own political systems, their own models, and adapt to their own circumstances.
Keep reading Show less