Stories abound on the market crash in China, examples here and here. The impact on other markets worldwide has been sharp and painful. Likely the pain isn't over yet.
What strikes us at COTTonLINE are the parallels between the crash of Japan Inc. in the early 1990s and the apparently ongoing crash of China Inc. today. In both cases crony capitalism seems to be a major culprit.
Corruption was also an issue in both. And in neither case was the government structure or the culture truly compatible with a healthy market economy.
Japan may never regain its former dominance. The days when Americans studied "Japanese Management" and praised nemawashi and quality circles are long gone.
Given China's rapidly aging population and bubble economy, could it be going the same way as Japan? It is too early to bet the farm, but the parallels are suggestive and, if forced to bet, it would be the way you'd lean.
