China's Bond Defaults Show Beijing's War On Debt Is Back

A spurt of missed debt repayments by three Chinese state-owned firms - a coal miner, a chipmaker and an automobile company - has shaken local markets and heightened speculation that a campaign to wean the economy off heavy credit is back, Reuters reported. The defaults have angered investors, who say their faith in the firms’ top-notch ratings, seemingly sound finances and implicit state backing has been violated. While the notable lack of state support for struggling state-owned enterprises (SOEs) suggests Beijing now has more confidence in the economy’s ability to absorb such failures, it has caught many bondholders off guard. Read more