China’s central banker talks about risk
Xi Jinping’s speech at the opening of the 19th Party Congress used the word risk (风险 fēngxiǎn – listen to pronunciation) nine times. Only once was he explicitly referring to financial risks, but within 24 hours of Xi’s marathon oration, his central bank chief was, according to Reuters, issuing “a stark warning about asset bubbles in the world’s second-largest economy.”
- As governor of the People’s Bank of China (PBoC), Zhou Xiaochuan 周小川 has been China’s chief central banker since 2002, and is highly regarded. He is also 69 years old and set to retire soon, so he is perhaps feeling free to speak his mind.
- Reuters reports that “on the sidelines” of the 19th Party Congress, Zhou “spoke of the risks of a ‘Minsky moment’ in the economy, referring to a sudden collapse in asset prices after long periods of growth, sparked by debt or currency pressures.”
- The warning is Zhou’s second in the last week. On October 15, Bloomberg noted that at an event in Washington, D.C., Zhou said “that Chinese companies have taken on too much debt, and argued for less financial leverage as well as fiscal reforms to constrain local government borrowing.”
Xi Jinping Thought
China-watchers have had a day to digest Xi Jinping’s three-and-a-half-hour-long speech and recital of his work report, which opened the 19th Party Congress yesterday.
- You can read the full text of the report in Chinese on Eeo.com.cn; I am not aware of a full English translation yet.
- I still stand by my “cheat sheet” published yesterday summarizing the contents of Xi’s speech. See the Politics section below or this link for more on the 19th Party Congress, or see the China Daily’s highlights of the report, Quartz’s “five-minute summary,” or the New York Times’ “five takeaways.”
- Two of the closest observers of Chinese politics, Trivium and Sinocism (paywall), today both noted the importance of the Party adoption of the concept and phrase “Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era,” which Xi used in his report. Xi did not use his own name in his speech, but Party media have already begun to do so.
- Xinhua News Agency reports: “The Chinese Communists mainly represented by Xi Jinping have created Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, leading Party officials said Wednesday.”