China weekly

[Stephen]

Some info on the Chinese economy from Fx Weekly: My wife has said the property prices have been falling.

 

China strategist David Roche said China¡¯s economy is teetering on the edge of a major slowdown, though its not a shakeout in the property market that¡¯s about the spark in the distress. Roche, an economic and political analyst who manages the Hong Kong based hedge fund Independent Strategy, says the world¡¯s third-largest economy is now on the brink, faced with the inevitable reckoning that follows an extended bank-lending binge. ¡°We¡¯ve got the beginnings of a credit-bubble collapse in China¡± said Roche, predicting the economy will likely cool from its stellar double-digit growth rate to a 6% annual expansion as a result

 

Banks are improving their capital base ahead of an expected dip in property prices by as much as 30%, in attempt to pre-empt any moves from Beijing to diffuse the housing bubble. Bernstein Research reported that they expect only 4% of outstanding mortgages in China will experience negative equity positions if housing prices fall by 30% across China. However, the report also noted that if there is a 40% dip in house prices, the number of underwater mortgages quickly rises to 16%, which would put banks under pressure.

 

Read more: DailyFX - China Weekly 05.17 http://www.dailyfx.com/forex/fundamental/a...l#ixzz0oBL6o485

[GDBILL]

Some info on the Chinese economy from Fx Weekly: My wife has said the property prices have been falling.

 

China strategist David Roche said China¡¯s economy is teetering on the edge of a major slowdown, though its not a shakeout in the property market that¡¯s about the spark in the distress. Roche, an economic and political analyst who manages the Hong Kong based hedge fund Independent Strategy, says the world¡¯s third-largest economy is now on the brink, faced with the inevitable reckoning that follows an extended bank-lending binge. ¡°We¡¯ve got the beginnings of a credit-bubble collapse in China¡± said Roche, predicting the economy will likely cool from its stellar double-digit growth rate to a 6% annual expansion as a result

 

Banks are improving their capital base ahead of an expected dip in property prices by as much as 30%, in attempt to pre-empt any moves from Beijing to diffuse the housing bubble. Bernstein Research reported that they expect only 4% of outstanding mortgages in China will experience negative equity positions if housing prices fall by 30% across China. However, the report also noted that if there is a 40% dip in house prices, the number of underwater mortgages quickly rises to 16%, which would put banks under pressure.

 

Read more: DailyFX - China Weekly 05.17 http://www.dailyfx.com/forex/fundamental/a...l#ixzz0oBL6o485

 

 

Very interesting!

[TLB]

Somewhere in the back halls of the CCP, someone is heard mumbling: "I wonder whether we should have opened that damned door after all..."