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Red Capitalism: The Fragile Financial Foundation of China's Extraordinary Rise
     

Red Capitalism: The Fragile Financial Foundation of China's Extraordinary Rise

by Carl Walter, Fraser Howie
 

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The truth behind the rise of China and whether or not it will be able to maintain it

How did China transform itself so quickly? In Red Capitalism: The Fragile Financial Foundation of China's Extraordinary Rise, Revised Edition Carl Walter and Fraser Howie go deep inside the Chinese financial machine to illuminate the social and political

Overview

The truth behind the rise of China and whether or not it will be able to maintain it

How did China transform itself so quickly? In Red Capitalism: The Fragile Financial Foundation of China's Extraordinary Rise, Revised Edition Carl Walter and Fraser Howie go deep inside the Chinese financial machine to illuminate the social and political consequences of the unique business model that propelled China to economic powerhouse status, and question whether this rapid ascension really lives up to its reputation.

All eyes are on China, but will it really surpass the U.S. as the world's premier global economy? Walter and Howie aren't so certain, and in this revised and updated edition of Red Capitalism they examine whether or not the 21st century really will belong to China.

  • The specter of a powerful China is haunting the U.S. and other countries suffering from economic decline and this book explores China's next move
  • Packed with new statistics and stories based on recent developments, this new edition updates the outlook on China's future with the most cutting-edge information available
  • Find out how China financed its current position of strength and whether it will be able to maintain its astonishing momentum

Indispensable reading for anyone looking to understand the limits that China's past development decisions have imposed on its brilliant future, Red Capitalism is an essential resource for anyone considering China's business strategies in today's extremely challenging global economy.

Editorial Reviews

From the Publisher
“...China is bent on superpower rivalry; reserve currency status for the renminbi is a glint in the party’s eye. Red Capitalism puts a powerful case that [China’s] economy and financial system are not fully equipped to support such aspirations.”
Financial Times, January 2011

“So pervasive has this view [that the 21st century is China's for the taking] become that any effort to examine whether it's actually true comes as a breath of fresh air. "Red Capitalism" is such a work. Authors Carl E. Walter and Fraser J.T. Howie, both investment bankers, argue that China isn't so different from other economies nor so immune from normal economic laws as cheerleaders argue. An examination of the financial system—or "how China's political elite manages money and the country's economy," as the authors put it—offers a useful lens through which to view much broader issues.”
The Wall Street Journal, January 2011

“[The authors’] ongoing research is an indispensable resource for those seeking the reality behind the often nauseating and sycophantic hyperbole surrounding China’s capital markets.”
China Economic Quarterly, December 2010

“In their new book, "Red Capitalism: The Fragile Financial Foundation of China's Extraordinary Riser Carl E. Walter and Fraser IT. Howie paint a troubling portrait of the Chinese economy and financial system. Despite the nation's mind-boggling growth and images of gleaming skyscrapers and luxury cars, the authors say the Chinese growth model is flawed and fragile, and they warn about substantial risks accumutating in its banking system.”
The New York Times & International Herald Tribune Asian edition, January 2011

“If Walter and Howie are right, China may be approaching a period when it can no longer hide the systemic flaws in its banking system; the more profound and problematic question the authors of Red Capitalism want their readers to ask is what this means for China as a whole. The answer will likely impact not just the Chinese, but people around the world as well.”
Asia Times Online, January 2011

The most important financial book of the year."
James Grant, editor, Grant's Interest Rate Observer

“Red Capitalism peels back the facade of China's economy and reveals how the dominant role of the state has led to enormous financial leverage and endemic malinvestment. China's major role in the global economy makes Red Capitalism required reading for any financial industry fiduciary.”
Mark L. Hart III, Chairman, Corriente Advisors, L.L.C.

Product Details

ISBN-13:
9781118255100
Publisher:
Wiley
Publication date:
03/06/2012
Edition description:
Revised Edition
Pages:
260
Sales rank:
572,335
Product dimensions:
6.20(w) x 9.10(h) x 1.10(d)

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What People are Saying About This

From the Publisher
Carl Walter and Fraser Howie debunk a number of common myths about China's financial markets in this excellent new book. Investors stuffing their portfolios with China stocks would be wise to heed their warnings on the fragile foundations of China's banking system. The authors have done their homework, digging beneath the surface of China's financial world to reveal uncomfortable truths about a financial system riddled with hidden landmines that threaten to undermine China's hard fought economic success in the years ahead.
Rick Carew, Former Asia M&A Reporter, The Wall Street Journal

In Red Capitalism, Carl Walter and Fraser Howie give a powerful, albeit controversial explanation of the fragile underpinnings of the financial edifice that financed the seemingly unstoppable rise of China on the global stage-which is all the more persuasive thanks to their careful mining of the data. Their thesis that China has the trappings of a market system but not the substance should be considered by anyone dealing with or investing in China-categories which embrace most of the world today. Their contention that China ultimately is a "family business" explains much that is puzzling to outsiders.
Henny Sender, Chief Correspondent, International Finance, Financial Times

Red Capitalism is a superb guide to China's financial labyrinth. It's a must-read for anyone who wants to understand the sources of Chinese economic power, and the threat posed by the nation's vast hidden debts.
Arthur Kroeber, Editor, China Economic Quarterly

Finally, a way into the world's most important and least understood financial system. For insight into how China's economy actually operates, begin here!
Thomas Easton, Asia Business Editor, The Economist

A penetrating analysis that demonstrates how hard it is to follow the old adage "follow the money", and how rewarding it is to understand what will really drive China into the future.
Christian Murck, President, American Chamber of Commerce in China

Walter and Howie put the Chinese financial system under the microscope to examine how an absence of leadership, institutional squabbling and complacency have seen appetites for reform sputter out, and replaced by stagnation and dysfunction. Theirs is a fascinating, entertaining and necessary corrective to the hyperbole surrounding China's seemingly-miraculous rise.
David Wilder, Beijing Bureau Chief, Market News International

Walter and Howie's penetrating study addresses a critically important issue in China's political economy. They possess a rare depth of experience in the analysis of the Chinese financial sector. Their hard-hitting conclusions, based on a wealth of empirical research, will stimulate debate about the future of the Chinese financial system at a critical point in its evolution.
Peter Nolan, Sinyi Professor, Judge Business School, University of Cambridge

Meet the Author

Carl E. Walter lived in China for twenty years and actively participated in numerous financial reforms. He played a major role in China's groundbreaking first overseas IPO in 1992, as well as the first listing of a state-owned enterprise on the New York Stock Exchange in 1994. He was a member of the Management Committee at China International Capital Corporation, China's first and most successful joint venture investment bank, where he supported a number of significant domestic stock and debt underwritings for major Chinese corporations. More recently, he helped build one of the most successful and profitable domestic security and currency trading operations for a major global investment bank. Fluent in Mandarin, he holds a PhD from Stanford University and a graduate certificate from Beijing University. He currently lives in New York where he acts as an independent consultant.

Fraser J. T. Howie studied Natural Sciences (Physics) at Cambridge University and Chinese at Beijing Language and Culture University. For nearly twenty years he has been trading, analyzing, and writingabout Asian stock markets. During that time he has worked in Hong Kong, trading equity derivatives at Bankers Trust and Morgan Stanley. After moving toChina in 1998, he worked in the sales andtrading department of China International Capital Corporation followed by a stint with China M&A Management Company. He has contributed to the SCMP, AWSJ, China Economic Quarterly,and China Economic Review as well as being a regularChina commentator on CNBC, BBC, Al Jazeera, and Bloomberg. Currently, he is a Managing Director at a leading Asia Pacific Brokerage firm in Singaporehelping international investors invest in both the Indian and Chinese markets.

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