Something is afoot in Chinese shadow finance
This post is not about another Chinese shadow financing innovation, or the possible or actual blowing up of said innovative products. Nope. Something even worse… Although the new Chinese leadership...
View ArticleChina’s massive credit dependency
Friday’s announcement of new daily liquidity operations by the Peoples’ Bank of China has prompted a lot of speculation about what it means for monetary policy in China. The PBoC has historically set...
View ArticleGMO on China’s subprimey financial innovations
A new and scary note is out about China’s risk from GMO’s Edward Chancellor and Mike Monnelly, who make a good argument that China’s financial system is showing many of the hallmarks of a...
View ArticleClik here to view.
Deflating shadow credit in China
First, a reminder of the degree to which China’s growth has been increasingly fuelled by credit over the past few years: The chart above doesn’t quite show it, but non-bank credit growth outpaced bank...
View ArticleWMPs and China’s shadow banking whack-a-mole game
The China Banking Regulatory Commission last week issued several strict-sounding new rules applying to the issuance of Wealth Management Products. The investment products have seen massive growth in...
View ArticleChina’s credit-to-GDP ratio, updated (and why it matters)
Following on from our post on Monday comparing China’s relatively low GDP growth and its relatively high levels of new credit… Here are some updated charts from Michael Werner of Bernstein Research,...
View ArticleClik here to view.
China’s growing debt, and Magnus on where it might be headed
These sorts of charts have been bothering a lot of people lately, including us: This one, via UBS’ George Magnus, shows China’s debt back near a 2009, stimulus-era ratio. Only, this time, it’s without...
View ArticleWhere the Chinese credit is going…
After Chinese first quarter GDP missed expectations, there was some hope that the relatively strong manufacturing PMIs in March would point to a better second quarter. Now that we know China’s April...
View ArticleClik here to view.
Chinese shadow banking: three different ones
That’s a big (click to enlarge) chart from Moody’s on how they define “shadow banking” in China, via a Q&A comment on the growth of the sector.Continue reading: Chinese shadow banking: three...
View ArticleChina’s debt servicing cost and dat Minsky moment
A little update on China’s growing debt-to-GDP ratio, which has caused much alarm and puzzlement this year. We’ve mentioned before a very interesting 2012 BIS paper on national debt servicing ratios,...
View ArticleWhat’s supporting China’s stressed borrowers, and their banks
The bull/bear arguments about China are evolving — or so we’d like to think — into a more nuanced debate about how the country’s leaders are going to respond to the pressing need for change (which they...
View Article
