balancing act: While authorities have so far been reluctant to rescue troubled borrowers and ramp up stimulus, the costs of maintaining that stance are rising as defaults increase and China's slowdown deepens. ; Policymakers are attempting to do the minimum necessary to keep the economy on the rails, Andrew Tilton, chief Asia-Pacific economist at Goldman Sachs Group Inc., said in a Bloomberg TV interview, according to The Japan Times. Among China's most vexing challenges is the deteriorating health of smaller lenders and regional state-owned companies, whose financial linkages risk triggering a downward spiral without support from Beijing. Xi Jinping's government faces an increasingly difficult balancing act as it tries to support the world's second-largest economy without encouraging moral hazard and reckless spending. A landmark debt recast proposed this week by Tewoo Group, a state-owned commodities trader, has raised concerns about more financial turbulence in its home city of Tianjin. Confidence in these institutions has waned since May, when regulators seized control of a lender in Inner Mongolia and imposed losses on some creditors. Similar concerns have popped up across the country in recent months, often centered around smaller banks.
(news.financializer.com). As
reported in the news.
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