China Is Lending Billions to Countries in Financial Trouble

In following the demise of FTX and it’s Founder Sam Bankman-Fried, we just witnessed how “The Law of Cause & Effect” relates to companies and the individuals who start and manage them.  But surely those rules don’t apply to entire countries…do they? This cautionary tale about China’s “Belt & Road” initiative, is instructive in that regard.

Starting in 2013, China began their plan to outflank U.S. influence in “developing” countries by making $1.3 trillion in loans to them for infrastructure projects like dams, roads and bridges. They also sent the workers and materials to complete those projects, in essence employing and paying the workers they brought with them, with the very funds they were lending, rather than hiring & training local workers as well.

However, most egregious was that the loans they made, used “adjustable rate” debt, which is now significantly more expensive to service and has left the countries involved strapped with payments they can’t hope to maintain. This has forced China to shift to a strategy of refinancing and bailing out those borrowers, to avoid write-offs and a big, global black eye!

So yes! The “Law” works the same for countries, as for companies, as for individuals. Moreover, whether the Law is referred to as “Karma” or “The Law of Cause & Effect,” or “What Goes Around Comes Around,” which all mean the same thing, the result will also be the same!

Instead of lending money for highways and bridges, China has shifted to providing emergency rescues for previous borrowers.

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A successful guide that uses anecdotes to reveal powerful truths about life.  

The stable, positive, non-preachy and objective voice makes the book stand apart from others in the genre.

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China Is Lending Billions to Countries in Financial Trouble

China Is Lending Billions to Countries in Financial Trouble

…And here is a genuine story about how even minimal effort to bring comfort to another human can result in outsized and wonderful results. How different the world might seem to many if that kind of true effort actually ran wild! It is a thought worth considering. It is also a siren call to each of us!

New research shows small gestures matter even more than we may think.

I wonder about when this train actually went off the rail and Balwani and Holmes both knew it. It reminds me somewhat of Bernie Madoff’s $20 Billion deception in that if Bernie had fessed up when his performance first went south and he tried to cover it up, only to make it worse, he might largely have been forgiven and returned to his original trading business. But he just couldn’t do that and as time went on…well we know the result.

Was there a similar trajectory for this pair? A time when they looked at each other and said, “Uh oh!” Not that it matters really. Somewhere along the way they knew what was going down and kept it going for as long as they could. Now have to face the music as eventually, always is the case. It is simply “The Law of Cause and Effect” unfolding. Hopefully for them there will be less tragic endings than Bernie. It depends on how they handle what they have wrought! We’ll see.