Asia Equities: China’s Risk of a Debt Deflation Loop

This podcast episode examines the economic challenges faced by China, comparing its current situation to Japan's deflationary period from 1991 to 2001. It highlights the similarities between the two countries in terms of deflation, debt, demographics, and structural problems, but also notes some key differences. The discussion proposes policy measures for China to address its challenges, emphasizing targeted interventions and the importance of capital market restructuring, liquidity support, and shareholder returns. While a return on equity path stabilization is projected for China, experts caution that significant efforts from policymakers are necessary for further upside.