kappa5

China: Explosion in New Lending

please do remember that going into the crisis, 2007 and 2008, China literally had it's foot on the neck of (corporate) borrowers, throttling down bank loans. You see, bank loans in China are an a quota system. China's banking system was restrained in the global easy credit days. RESPECT ! Just because the quota has been doubled for a brief time doesn't necessarily mean bad investment to follow. Bank loans in China are typicially one-year loans, which can be rolled over but will affect the next year's quota. Furthermore, who is to say the quota that was in place was an equilibrium? Maybe 2x the quota is a fine equilibrium? So, all the hubub over China's loosened lending is moot unless some can provide historical data showing a similar past situation and it's effect.

China's Xinjiang Riots: The Energy Connection

hope the comment givers can stay dispassionate and apolitical
and stick to investment related ideas. this goes for the all the content of this site. if you want to impress us readers then stick to the basics with brief and powerful insights. cheers :-)

The Impact of Recent Regulations on Chinese Online Gaming Stocks

nice work and information.

China's Stock Market Bubble Inflating

Remember that China was the only country tightly squeezing credit in 2007 and 2008. Now, they're letting it loose a bit. It's OK. shorterm, I personally subscribe to the thesis of Larry Kantor of Barclay Capital that we're about to see a cyclical inventory rebuild in the US markets, ie autos are selling at a run rate of 10M cars per year, peak was 16-17m, bottom was 8.5M, but auto makers are currently producing at a run rate of 4.5M cars per year, meaning that the US auto industry is going to double production in 2 - 3 months time. Long term if there is a bubble in china its at least 2 years away, or 3. lots can happen in that time. how many people are making 2-3 year bets here?

Surge in Chinese Government Debt and 'Stimulus' Loans Threatens Sustainable Recovery

from the article: <Respected economist Michael Pettis observes: "A decline in U.S. consumption equal to 5 per cent of U.S. GDP, for example (which is a low estimate), would require an increase in Chinese (domestic) consumption equal to 17 per cent of Chinese GDP - or a nearly 40 per cent growth in consumption.">
this statement is facetious. pure clownery. the numbers don't work, not even close.

back of the napkin, ballpark figures will illustrate the irresponsibility of these claims.........
1) from the China economy side: needing a 40% growth in consumption (consumption currently stands around 35% of the China GDP), means China consumption needs to increase from 35% of GDP to 49%. A 7.14% drop in US consumption (5% of GDP) requires Chinese consumption to grow 40%.???? incredulous.......

I'm not going to waste my time breaking down the rest of the absurdities. the title "dis-respected economist....." is more accurate, unless there is a coming retraction on his part......

What Increased U.S. Savings Means for China

the comparison of China with Japan in the late 1980's needs to factor in the role of Korea and Taiwan literally taking away profits from the Japanese electronics sectors. Without breaking it down into a great amount of detail, Korea and Taiwan started producing in mass and taking away a great deal of profits from Japan. I don't think this effect will occur with China. There is no nor will there be a lower cost producer to take away China's cake. So, the comparison with Japan and China does have the resonance of hubris, but I think the results will be different.