fiscal-policy
2 articles
- China's Strategic Deficit: A Fiscal Crowding-Out Failure, Not a Confrontation Error
China's strategic deficit can be explained as a fiscal crowding-out problem: capital was absorbed by real estate and local government balance sheets before domestic semiconductor capabilities reached strategic self-sufficiency.
- Interest Rate Transmission in High-Debt Regimes
The traditional interest rate transmission mechanism has structurally inverted in a high-debt regime. Rate hikes redistribute demand rather than compress it — sovereign interest expense flows to private Treasury holders, private legacy debt remains insulated by duration lock-ins, and the strain relocates to the term premium and the refinancing wall rather than disappearing. Fiscal-monetary interaction, collateral repricing, and state capacity now override private credit cycles.