Global economy is distorted and distorted. As Mainland China controls money supply from reserve ratio. Chinese corporations seem to borrow fund from banks difficultly, they borrow fund from underground financial institutions over 10%. This is ridiculous 10 times. These corporations borrow fund from banks of Hong Kong alternatively. The consequence is interest rate pulled up, the lending risk is increased on the banking system in Hong Kong. Some corporations in China seem to be tight on fund.
USA still requires QE3 for increasing money supply to stimulate economy. However, the extra money supply seems not to inject into property market and production market. The extra money supply injects into stock market and currency marktet under carry trade of US dollar through financial instituations. The consequence of the action is inflation, now the global economy have stagflation. The inflation is serious but the economy is going to be down. In the future, the global economy may increase interest rate sharply, the interest rate may increased to 10% or above. The situation may be similiar to 70'.
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