china

Year of the yuan: China’s explosive currency goes global

"Degenerating credit quality across the board has prompted asset managers to turn to the yuan, a currency that 10 years ago was completely off limits to foreign investors. An HSBC forecast projected that by 2015, the yuan will become one of the three most used currencies in global trade, in league with the dollar and euro. The report, issued in April, also foresees a third of China’s cross-border transactions being carried out in yuan. China has been making a concerted effort to establish itself as an international currency reserve. China already has agreements with Russia, Vietnam, Thailand, and Japan allowing trade to be settled in yuan instead of dollars." Continue reading →

Continue ReadingYear of the yuan: China’s explosive currency goes global

More countries use Chinese yuan to settle international payments

"Of the 160 countries that settled payments with Hong Kong and the mainland last month, 47 had at least 10 per cent of their transfers made out in the yuan, according to SWIFT, a global member-owned co-operative servicing financial institutions. The number of countries 'crossing the RMB river', or having at least 10 per cent of payments valued in the yuan, grew 9 per cent in the nine months to April this year, SWIFT said in a report yesterday. Italy and Russia are among the major adopters of the yuan. Other places where the currency is increasingly popular for payments include Britain and Singapore, the organisation said." Continue reading →

Continue ReadingMore countries use Chinese yuan to settle international payments

Human breast milk has become a new luxury for China’s rich

"Xinxinyu, a domestic staff agency in the booming city of Shenzhen, which borders Hong Kong, provided wet nurses for newborns, the sick and other adults who pay high prices for the milk’s fine nutrition, the Southern Metropolis Daily said. 'Adult (clients) can drink it directly through breastfeeding, or they can always drink it from a breast pump if they feel embarrassed,' the report quoted company owner Lin Jun as saying. Wet nurses serving adults are paid around 16,000 yuan ($2,600) a month — more than four times the Chinese average — and those who were 'healthy and good looking' could earn even more, the report said." Continue reading →

Continue ReadingHuman breast milk has become a new luxury for China’s rich

Now They Tell Us: China Debt Levels ‘Unknown’

"A senior Chinese official said on Friday that the government did not know precisely know how much debt local governments had built up and warned that it could be more than previous estimates. Estimates of local government debt range from Standard Chartered's 15 percent of the country's GDP at end-2012 to Credit Suisse's 36 percent. Fitch put the figure at 25 percent when it downgraded China's sovereign debt rating in April. Vice Finance Minister Zhu Guangyao said China had not released official figures since a 2010 auditing report that put local government debt at 10.7 trillion yuan." Continue reading →

Continue ReadingNow They Tell Us: China Debt Levels ‘Unknown’

India launches first of seven navigation satellites

"India launched the first of seven satellites for its domestic satellite navigation network in the first step to creating a scaled down version of the US Global Positioning System. The United States’ GPS is the most widely used network by consumers with 24 satellites, but other countries including Russia, the European Union and most recently China have developed rival positioning systems. China’s Beidou, or Compass, navigation system is expected to offer global coverage by 2020. India has a well-established space programme, but its cost has attracted criticism as the government struggles to tackle poverty and child malnutrition." Continue reading →

Continue ReadingIndia launches first of seven navigation satellites

China media warns Philippines of ‘counterstrike’ in South China Sea

"China's state media warned that a 'counterstrike' against the Philippines was inevitable if it continues to provoke Beijing in the South China Sea, potentially Asia's biggest military troublespot. A front-page commentary said that the Philippines had committed 'seven sins' in the South China Sea. These include the 'illegal occupation' of the Spratly Islands, inviting foreign capital to engage in oil and gas development in the disputed waters and promoting the 'internationalization' of the waters, said the commentary. The Philippines has called on the United States to act as a 'patron', while ASEAN has become an 'accomplice,' said the commentary." Continue reading →

Continue ReadingChina media warns Philippines of ‘counterstrike’ in South China Sea

China, Russia Begin Naval Drills In Sea Of Japan

"Six weeks after South Korea and the US flexed their naval muscles in a joint naval exercise, a mere month after China protested over joint Japan-US naval drills, and amid growing US tensions with the Russians, a Chinese fleet consisting of seven naval vessels departed Qingdao to join in Sino-Russian naval drills scheduled to begin this weekend. The eight-day exercise is expected to be conducted at the sea area and airspace of the Peter the Great Gulf in the Sea of Japan with the Chinese fleet. A total of 18 vessels, one submarine, three fixed-wing planes, five carrier-based helicopters and two teams of special forces from the two countries will participate." Continue reading →

Continue ReadingChina, Russia Begin Naval Drills In Sea Of Japan

You’re Not That Important

"Americans like to think that they’re the world’s most-important consumers. While that’s true now, our reign is coming to an end. Here’s the news: By 2015, Asia will have more consumers than all of the West combined, reclaiming its spot as #1 for the first time in 300 years, largely thanks to the emergence of China and its rapidly rising middle class. With anemic economic growth in the U.S. and many developed euro zone countries now slipping back into recession, multinational retailers have been angling for expansion elsewhere — and they are now targeting increasing numbers of consumers from emerging and frontier markets." Continue reading →

Continue ReadingYou’re Not That Important

Kyle Bass: If China Doesn’t Change, ‘Full-Scale Recession’ Sometime Next Year

"'The compounded annual growth of bank assets as measured by the China Banking Regulatory Commission has been 30.8%,' Bass wrote. 'To give some perspective, a 30.8% compounded annual growth of credit in the U.S. equivalent over 5 years would be an expansion of $33 trillion. This rate of credit growth is three times the total credit system growth experienced in the U.S. at the peak of the bubble in 2006... The debt-to-equity ratios of Chinese companies are exploding as they funnel new capital, not into yield returning investments, but into the black holes on their balance sheets that have been created by a slowing growth environment.'" Continue reading →

Continue ReadingKyle Bass: If China Doesn’t Change, ‘Full-Scale Recession’ Sometime Next Year

Loan Practices of China’s Biggest Banks Raising Concern

"Text message solicitations began arriving on the mobile phones of many of China’s wealthy last month, promising access to lucrative wealth management products with yields far above the government’s benchmark savings rate. The offers are not coming from fly-by-night operators but some of China’s biggest banks. They are raising huge pools of cash to finance a relatively new and highly profitable sideline business: lending outside the scrutiny of bank regulators. The complex way they go about making off-the-balance-sheet loans is at the heart of China’s $6 trillion shadow banking industry, which the government is now trying to tame." Continue reading →

Continue ReadingLoan Practices of China’s Biggest Banks Raising Concern