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Anywhere else, the trust that underpins the financial system—the trust between the public and banks, and among the banks themselves—would have eroded long ago. But in China, financial stability is based not on the relative health and good management of the banks but on the widely held belief that the government will always intervene whenever necessary to ensure the stability of the system, a belief based on Beijing repeatedly doing just that. In most economies, government intervention is typically limited to changing interest rates and printing money. Beijing, however, is far more expansive in its use of state power. When the stock market collapsed in 2015, Beijing stepped in, deploying all the various powers at its disposal to stop the rout. It mobilized a group of large state-owned firms—what became known as “the national team”—to buy up huge volumes of shares, and they set themselves up as buyers of last resort. Ultimately, they spent about 1.5 trillion yuan to stop share prices from falling any further. Fund managers were pressured to only buy stock and not sell. Television and radio stations were instructed to soft-pedal their coverage and to avoid using harsh words like “slump” or “collapse.” People were arrested for “spreading rumors” relating to the stock market. When Caijing, one of China’s premier financial magazines, reported that the national team was planning on winding up its intervention, the journalist who wrote the story was arrested and, while still in custody, made a televised apology. “I shouldn’t have released a report with a major negative impact on the market at such a sensitive time,” he said. “I shouldn’t do that just to catch attention which has caused the country and its investors such a big loss.” Therein lies China’s strength. No one questions Beijing’s commitment to maintaining stability. Beijing’s willingness to use all the tools at its disposal—whether telling state firms to buy shares, or molding public opinion—has traditionally made the prospect of China’s experiencing a financial crisis seem fanciful. But this is also China’s Achilles’ heel. With financial institutions safe in the knowledge that Beijing is providing a safety net, the system has grown bigger, more complex, and riskier. Moreover, and more disturbing, sometimes Beijing does lose control.
China's Great Wall of Debt
Dinny McMahon
Discipline #4: Create a Cadence of Accountability The 4DX authors elaborate that the final step to help maintain a focus on lead measures is to put in place “a rhythm of regular and frequent meetings of any team that owns a wildly important goal.” During these meetings, the team members must confront their scoreboard, commit to specific actions to help improve the score before the next meeting, and describe what happened with the commitments they made at the last meeting. They note that this review can be condensed to only a few minutes, but it must be regular for its effect to be felt. The authors argue that it’s this discipline where “execution really happens.”
As a modern commentator has summed up this old controversy, Edison knew he wanted a small light which could be independently controlled. Independent control implied a parallel circuit where, with a constant-voltage generator, the current units could be multiplied as desired. But the increase in current could mean either heavy current loss in transmissions or excessive copper cost. To avoid these the light would have to be of high resistance. That conclusion is easily reached by an elementary application of Ohm’s law. But in Edison’s time it was an important achievement which placed him far ahead of the other incandescent-lighting inventors and scientists...285 All that autumn, and through the winter of 1879 that followed, Edison studied the problems of high-resistance lamps and multiple circuits, as his notebooks show.286 As he himself confessed, this investigation of electric lighting required a most arduous program of research: Edison and his staff made lengthy studies of the electrical resistances of various substances, and examined them also for their heat radiation, recording their specific heats. The effect of increasing or lowering resistance, and of changing voltage or amperage on such materials, and of using them in different forms, was also measured carefully. Contrary to the prevailing impression, Edison was not primarily “the great tinkerer,” but was remarkable rather for his power of observation, his imagination, and clear-cut reasoning faculty. The delicate mechanical tinkering was handled by Charles Batchelor, who was literally Edison’s “hands”; Kruesi served as a superb machine maker; while John Ott did the drafting work after Edison’s rough sketches. One day Ott drew attention to the inventor’s hands; though usually soiled or acid stained, they were soft, white and beautifully formed — the hands of an artist, of a man who imagined things, not those of a workman or a craftsman.
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