China’s $34 Trillion Experiment Is Exploding – Kyle Bass

Kyle doesn’t give China the 2 years that Soros gives to muddle through.Time will tell, who, if either is right.But they are both banking on a Yuan devaluation.A weak Rupee helps exports. Also the Rupee, along with the Won, Dong, Ringgit etc. are seen as proxies for shorting the Yuan. We Rupee holders had best look sharp.

Here’s Kyle’s letter to his investors:

“Dear Investors,

Over the past decade, we have worked diligently to identify anomalies in financial systems, governments, and companies around the world. We have been vigorously studying China over the last year, with the view that the rapid credit expansion in the Chinese banking system will result in significant credit losses that will require the recapitalization of Chinese banks and materially pressure the Chinese currency. This outcome will have many near-term and long-term effects on countries and markets around the world. In other words, what happens in China will not stay in China. Read more of this post