China's Economic Recovery Masking Financial Risks, Fitch Says  …  Are We Heading Back Into China Markets Turmoil? … -Bloomberg

China is run by a communist party but its policies are increasingly mercantilist and reminiscent of European and US strategies.

Whether the world is run out of Washington or Beijing, the economic, political and military approach is increasingly similar.

China is in better shape financially than the West because of its central bank's emphasis on buying and retaining gold. China probably has at least several thousand tons of gold stored on the mainland, though officials will only admit to around 1,000 tons.

In fact, China just announced that it would create its own price fix for gold to compete with prices set in London. Additionally, the price fix will not be convertible to dollars.

But China's debt driven economic policies at the federal level are just as reckless as US policies, or European ones, as we can see from this latest article posted at Bloomberg.

More:

Andrew Colquhoun … the head of Asia Pacific sovereigns at Fitch Ratings, sees the growth spurt, fueled by a resurgence in borrowing, threatening to wreak havoc on the financial system.

"Whether we call it stabilization or not, I am not sure," Colquhoun said in an interview in New York. "From a credit perspective, we'd be more comfortable with China slowing more than it is. We are getting less confident in the government's commitment to structural reforms."

Standard & Poor's and Moody's Investors Service both chopped China's long-term credit rating outlook to negative last month. Expanding sovereign debt and a lack of market reforms prompted the downgrade.

China's new credit increased a whopping 4.6 trillion yuan ($712 billion) in the first quarter alone. This was more than the money printing that took place in 2009 when Chinese officials were desperately trying to restart China's economic motor.

China is said to be on course for growth of 6.5 percent this year, though that number is probably as bogus as previous "growth" numbers. It does imply that China will print as much money as necessary to keep the economy revving.

George Soros, among other China watchers, believes that China really doesn't have an industrial growth strategy – just the same solution as Western countries in similar positions.

The remedy is simply more and more money printing. Lower rates fuel enormous amounts of credit expansion. That's the extent of China's manufacturing remedy.

Bloomberg quoted Soros as saying that what's going on in China "eerily resembles what happened during the financial crisis in the U.S. in 2007-08, which was similarly fueled by credit growth."

Soros made his China views clear at the World Forum in Davos and has repeated them since then. He believes that China is in for a very "hard landing" because Chinese officials have cut neither spending nor debt issuance.

While Chinese state-run media rebut Soros's views, there is much to confirm it. Housing values are climbing to new height, with new-home prices in some places soaring a whopping 62 percent in a single year.

Understandably, Chinese politicians might want to change the subject – and in this case have done so by announcing ambitious plans for space exploration.

The UK Daily Mail recently posted an article entitled. "China wants to land on Mars by 2021."