In other words, the US government debt will grow, and other policy levers become ineffective. More money into the system is all they can do. That plants the seeds for the next crisis.

2. That is a world of difference for the Chinese government.

The Chinese government has options. I forget there was one chart I posted somewhere that explained everything, and I forget what it was.

Anyways, it seems kind of obvious.

If the Chinese economy is slowing down, what will the central government do?

They have four really big guns to do something to re-start a slowing economy.

i) more green tech investment, which is the preferred option today.

ii) bailout or simulate the real estate sector, which is not going to happen

iii) give something to the Chinese consumer to start spending

iv) monetary policy, sort of like Helicopter Ben if it gets desperate enough, haha!

Points, i) ii) iii) were addressed by Andy Xie in his article.

The consumer part he makes two important points that the Chinese consumer will eventually come around to spending again, as the travel and EV sales are sort of leading signs that the Chinese consumer still wants to spend. Eventually that will spread out to more sectors and products.

The clunkers for cash to entice consumers to trade in the old gasoline cars for EVs is one program the government can do to stimulate demand.

All in all, the Chinese government, when it comes to the Chinese economy, is in a good place, it is well position to do anything it wants to support the economy, when it wants to.

So when the Chinese consumer comes around to be spending more, then they can slow down spending on the Green tech, that way smooth out the boom bust cycle.

As for point iv) of monetary policy, of course they will still do that, but China will not go to extremes like printing money like Jerome does. There is no need for that.

Giving a $1 trillion dollar property market bailout would be like printing money. That is so dumb, no wonder the IMF recommends it.