Vendor Finance and the Global Financial Crisis. Keith Rankin Department of Accounting and Finance Unitec Friday 9 July 2010. Recent Writings re Global Financial Crisis [GFC]. Context of Balance of Payments global flow model AU Public Policy Group 29 October 2009
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Department of Accounting and Finance
Friday 9 July 2010
"… the continued growth of the USA … was only possible because of a system of 'vendor finance' provided by China to the rest of the world in order to enable Chinese exports to grow rapidly…" (p.149)
"One of the relief valves in the global economy will be a rise in Chinese wages reducing its competitiveness as the 'Factory of the World'. This would reduce the size of China's trade surpluses and make it less able to 'vendor finance' continued deficit-fuelled spending in the developed world."