People touch a bull statue on display outside a mall in Beijing, on June 18. A structural reshaping of the market will cause short-term pain, but rising defaults in the credit market suggest that the authorities are allowing the market to better price risks, which will only make the economy healthier. Photo: AP
Aidan Yao
Opinion

Opinion

Macroscope by Aidan Yao

Bond defaults in China are a necessary pain for a healthier economy

Aidan Yao says the rash of defaults in the corporate bond market, a result of Beijing’s deleveraging drive, must be tolerated to reap longer-term rewards

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People touch a bull statue on display outside a mall in Beijing, on June 18. A structural reshaping of the market will cause short-term pain, but rising defaults in the credit market suggest that the authorities are allowing the market to better price risks, which will only make the economy healthier. Photo: AP
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