China's Guaranteed Bubble cover
China's Guaranteed Bubble
by Ning Zhu
Description: China's Guaranteed Bubble by Ning Zhu examines how implicit government backing for major banks and local governments has driven economic growth in China while also increasing systemic financial risks
ISBN: 9781259644580
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ameister14 · 2017-12-07 · Original thread
>The presence of a totalitarian ruler willing to constantly backstop markets prevents panics and actually makes the system work better.

Not really. Remember this? https://www.forbes.com/sites/gordonchang/2014/01/19/mega-def...

If the government backs everything, people will engage in riskier behavior because they don't accurately assess risk. That creates a massive bubble of risky investments until it's too large for the government to effectively control.

There's an interesting book on the subject you might want to check out:

https://www.amazon.com/Chinas-Guaranteed-Bubble-government-p....