The World in 2012 – China Predictions
by Nicholas Borst | December 23rd, 2011 | 04:11 pmBe sure to check out Nick Lardy’s predictions for the Chinese economy next year at The Economist’s World in 2012 Festival.
RQFII to the Rescue?
by Nicholas Borst | December 20th, 2011 | 04:42 pmContinuing on last week’s theme of expectations, let’s take a look at ongoing developments in the offshore renminbi market. Despite breathless predictions of continued growth by the investment banks, the offshore market has hit a rough patch and deposits in Hong Kong actually declined in October. What’s at work here? Well it seems that expectations [...]
Great Expectations
by Nicholas Borst | December 15th, 2011 | 09:53 amTo understand the dynamics of the Chinese real estate market, it’s important to pay attention to the role of expectations. The danger with markets ruled by expectations is the speed at which they can change. China’s rapid economic growth over the past decade has depended on high levels of investment, of which real estate investment [...]
What Do Increasing Loan Impairment Losses Mean for Chinese Banks?
by Nicholas Borst | December 5th, 2011 | 02:16 pmChinese banks are setting aside more money for loan impairment losses, in effect reducing current profits by accounting for expected losses. An increase in expected losses seems puzzling at first given that banks’ loan portfolios have been improving over the past several years as shown by a steadily declining non-performing loan (NPL) rate, as reported [...]