Thursday, February 25, 2010

Nouriel Roubini on China Tightening

Nouriel Roubini on China

While a lot of people have made a big deal about the tightening in China, I agree, with Nouriel Roubini that in reality there is not much real tightening going on, and I think it's because of the negotiations China's going through concerning various commodities, including iron ore for its steel industry, among other commodity contracts they're negotiating over.

Eventually Roubini sees there will be an eventual tightening because of inflation, but that time doesn't seem to be here yet.

China is pretty cagey about its negotiations, and they got burned some last year when they didn't enter into predictable contracts with the major three iron ore companies, and spent more on the open market as a result.

Even with the so-called tightening, projections are China will lend at a growth rate of 20 percent form last year, albeit a little slower than the 30 percent at that time.

Nouriel Roubini on China

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