On China’s Banking Crisis & New Trade Flexibility

In consolidating its banking system, William reports, China risks repeating the mistakes Japan made in the 1990s when bad loans simply migrated to new balance sheets instead of being recapitalized. That paved the way to years of deflation and near-zero interest rates. … Also: Uncharacteristically, China has agreed to EU demands to halve its hybrid vehicle shipments to Europe, deescalating tensions between the two and perhaps opening the door to similar deals for other industries. What does China’s new conciliatory tack imply for its trade negotiations with other economies? Does the deal represent a new model for global trade?