Gerard Minack

Alan Kohler: Just on another matter, I wonder whether you think that the elephant in the global room is China, and in particular, Chinese debt.

Gerard Minack: I, it’s, it’s a problem. The reason I wouldn’t put it as the elephant in the room is the Chinese financial system is not that integrated to the rest of the world. Chinese policy makers have a firm grip on their capital account. It’s not, it’s all transmitted, transparent. As a result, look, if China, if I thought China was about to slump into a recession, we would have talked about it already. I think it’s just likely to be more muddled through in China, either a positive stimulus, a global recovery, more a major headwind. There will be problems out there at some stage with the buildup in Chinese debt. And we had this week the Bank for International Settlements elude to exactly that. The question in my mind is that something we need to worry about today, or is it next year? I’m not so sure it is. I think the big problem for China will be when they start to liberalise whenever that occurs. It’s sort of like when a dictatorship starts to lose in its control, that’s often when the revolution starts. I don’t think the revolution is this year.

AK: Great. Thanks very much, Gerard.

GM: Thanks Alan.