Time to pour cold water on talk of 'hot money'
One evening in December 2011, as chairman of Wansui Micro Credit Company in Guangzhou, I received a call from the Guangzhou city government's finance office. On the line was a Mr Liao who sternly...
View ArticleThe real problem behind China's shadow banking
In China today, the term "shadow banking" has a negative meaning. Over the past year, the China Banking Regulatory Commission has issued numerous policy directives to try to contain its explosive...
View ArticleAlibaba's Yuebao online funds vendor and its rivals will help savers but...
Within just six months, Yuebao, the partnership between China’s Alibaba, and a fund house, Tianhong Asset Management, raised 250 billion yuan (HK$318 billion) from millions of little guys to invest in...
View ArticleWhy a recession would be good for China
China’s economic growth slowed in the final three months of last year to 7.7 per cent, the weakest quarter since 2009, but still way too fast to allow for the restructuring that the country urgently...
View ArticleTime to pull the trigger
Beijing's carrot and stick approach to managing the economy has generally delivered more of the latter over the years. Discipline and the threat of penalties in the event of rule breaches provided the...
View ArticleThe quick buck economy
Thirty years ago this month, I was a graduate student at the People's Bank of China in Beijing. The average monthly wage on the mainland was about 40 yuan at that time. I was lucky to be paid 52 yuan....
View ArticleWhy Chinese stocks perform poorly
China's equity market has been around for 20 years, and its performance has been very disappointing. Since its birth in 1994, the Hang Seng China Enterprises, the so-called H-share index, has gone up...
View ArticleLending in the shadows
Twice a year I travel to Jingmen in central China to visit my parents and siblings. Last week, I was there on a new mission: to review the work of my sisters as shadow bankers. Shadow banking is...
View ArticleBank on the banks
Every investor likes to think that he or she is a contrarian. The truth is that they are anything but. A vast majority of investors go with the crowd, and why shouldn't they? They have received the...
View ArticleReform is a tall order
In an essay published in the Financial Times eight years ago, I said China's private sector was in the shadow of the state. I can make the same argument today with one significant difference: the state...
View ArticleChinese lenders ready to fight back if profitability is threatened
Within just six months, Yu E Bao, the partnership between the mainland's Alibaba and fund house Tianhong Asset Management, raised 250 billion yuan (HK$318 billion) from millions of little guys to...
View ArticleWhat exchange rate policy?
Analysts have built entire careers analysing and re-analysing the mainland and its economy. They make predictions, get proven wrong and move on to the next topic. It's been a very profitable pursuit,...
View ArticleLetting the air out of the bubbles
Despite the familiar refrain from analysts these last few years, China's real estate and credit bubbles have not burst. While I, too, am worried, I have not been brave enough to venture a prediction...
View ArticleState sector is China's secret sauce
It is too early to say if China has achieved economic success, even after 36 years of consistently high growth. Observers around the world say state-driven economies tend to be corrupt and inefficient...
View ArticleBeijing needs to turn off the credit tap
China's shadow banking is opaque, huge and fast-growing. In the past year, it has managed to cause two interbank crises, a few small-scale bank runs and several high-profile defaults and near-defaults...
View ArticleMainland China’s perpetual QE and its many losers
In 1983, the People’s Bank of China had just risen from being a junior sidekick to the Ministry of Finance to an equal entity within the government. A staffer from the US Federal Reserve who visited...
View ArticleChina’s looming debt crisis is no cause for alarm, says PBOC expert
It is widely known that China has one of the highest credit-to-GDP ratios in the world at 205 per cent. To put that in perspective, the US’ gross domestic product is 60 per cent bigger than that of...
View ArticleWhy worries about a sharp slide in the renminbi are overblown
Most China watchers have a very firm belief that the renminbi is significantly overvalued and that it is due to depreciate sharply at some stage, probably in the near future.Their conviction grows as...
View ArticleHow a fear of inflation is driving bitcoin’s popularity in China
Growing concerns about secrecy and the vulnerability of the global financial sector are forcing the general public to learn about bitcoin and associated technologies. Digital Gold: The Untold Story of...
View ArticleAll signs point to an economic slowdown in China, but warnings of a credit...
For the past four years, analysts at Fitch Ratings and Wall Street banks have shared a consensus: a credit crisis will break out in China at any time. Their prediction was based on two factors: China’s...
View Article
