Tag Archives | banking

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China’s Minsky Moment may be starting

Long-standing readers may remember the video posted in January 2010 showing ‘China’s empty city’. This was the new city being built in Inner Mongolia, to help ensure local officials met China’s GDP growth target. Unlike the West, GDP in a communist country is a target, not a result. Thus East Germany under communism was alleged […]

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China has “60% risk of banking crisis by 2013″

China’s housing market seems to be facing the threat of a major downturn. That is the only conclusion to be drawn from the rising sense of concern being expressed by policymakers and the official media. Last year, China’s Academy of Social Sciences estimated that “there are 64.5 million empty apartments and houses in China’s urban […]

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Obama proposes $90bn US bank tax

One by one, Western political leaders are coming to the conclusion that taxes on the banks need to rise. Last month, the UK proposed a 50% ‘super-tax’ on bonuses, on the grounds that “investment banks are making exceptional profits as a result of the intervention of government“. At the time, the blog thought it spotted […]

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US interest rates turn negative

The irresponsibility of some parts of the global banking system continues to upset the blog. First, there was news that several banks are planning to award themselves huge ‘bonuses’, based largely on their trading success. Yet the money they are using for this trading has mostly been provided by central banks and governments. And it […]

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China’s banks worry about the speculative bubble

This year, China has been the one place in the world where almost anyone can get a loan. But now, it seems policy is about to change. Zhang Jianguo, president of the 2nd largest bank, China Construction, has announced a 70% cut in H2 lending to Rmb 200bn ($29bn), “to avert a surge in bad […]

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Thought for the day

It is now generally accepted that reckless lending has helped cause the greatest collapse in the global economy since the Depression years of the 1930′s. Yet many bankers still maintain it is vital they continue to pursue “innovation” of the type that has brought about this collapse. Martin Wolf, a former EPCA speaker, makes a […]

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