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Is the assertion that Chinese bank equity is worthless news to anyone that was paying attention?
Chinese bank equity worthless? OK, so when do we get back to how US bank equity is even more worthless?
Yup! Many bank board room discussions in US about how the loans that cobbled together some payments in recent difficult years are now really struggling and starting to miss payments. Loan loss provisions, reduced for bank profits a couple quarters back, now need reprovisioning. Talk in the rooms now. Expect to see the numbers in regional and community bank reports 4th Qtr. For now, they're hoping magical thinking will turn it around . . . but they'll need to take medicine before December. Regulators are visiting more frequently and being tougher out in the field.
Oh my god, you mean when people lose their jobs they don't make their loan payments?
Me-oh-my! What a pickle!
Let's raise taxes.
We've all (here at least) been maintaining that US banks have no equity quite consistently since 2008. This is not a pro-US article. Did you not catch the reference in this very article to "Countrywide Lynch"? - the fact that China's banks are up to 100% overvalued is fairly underreported, especially by the "China will save us" and "China is invincible" crowd. The China bubble is not news to anybody who has been avoiding groupthink in the FinSvcs echo chamber but those inside the chamber are beginning to catch on.
Fast Money vs Jim Chanos. They both can't be right.
More worthless? Is that like 'more unique?'
Nope, apart from central bankers, politicians, media, "market makers", investors........ of course
Reggie! What's up! Hey I know I have given you grief for your Apple predictions but I think your time may be coming! But I have been hearing mixed meesages in the MSM. First I hear Ipads sales are off 25% then I hear that Iphone 4s sell out at the fastest pace in history.
Looking forward to your next post on this.
As you well know Reggie, "bank equity" is an oxymoron.
PS-Love your posts Reggie.
Quick answer. NO.
How come your avatar isn't you being shirtless and kicking something?
It has been clear for a long time that China was a bubble. If for nothing else, the hype around "The Century of China" story and the viciousness with which it was defended was the tell.
Now we are seeing the rule of hot money in play. Fraud chases hot money, so you see companies like Sino Forest pop up, and even solid companies are found to be in worse shape than anyone thinks because hot money blinded everyone to them cooking the books. Unfortunately, nowhere in the world has money been as hot as it was in China. Hot money and no transparency will burn everything down.
Of course it's all a bubble. GROWTH is a bubble! And, 10%+ growth? Anyone thinking that this kind of number could hold out for very long has ZERO understanding of the exponential function: 10% means a doubling time of 7 years- yes! in just seven years China's economy would double! try to keep this up- can't happen.
Once I came to understand what exponential growth meant to economics (and other human activities) I found that it's all pretty easy to know what's ahead.
I'm probably one of those who has not paid attention. Back before Summer, we did the rounds of NPL estimates on Chinese banks, somebody's report had to be revised with apologies all round and now it turns out they were (almost) right after all. CS has been pretty good with their research this year, so I'm definitely awake this time.
Thus another reason for a Bizarro World stock rally.
More signs of global economic collapse = buy buy buy
Yes! Just when my coke induced buying frenzy was waning, this news came out. Party on!
Im happy with my investment strategy, just last night picked up 4 more cases of Jim Beam pints. When this shit market implodes suddenly 1 morning, those will be worth more than Krugerands!
Alcohol content not high enough, only about 40%. Low yield flame. Stick to cheap gas/diesel.
That reminds me, I have some Woodfords to restock.
shorting is the right trend for a while.
That's the human interpretation. HFTs are only interested in quantifiable data..
Im sure its all bad for the dollar so great for bubble equity markets!
CDS told us this weeks ago
as Tears for Fears sang: "It's a Mad World"
A bit suprised to see the Swiss are not staying neutral in this war.
Either you peg or you get pegged.
Yes, but the Swiss Alps get pretty cold in the winter, and the wood only lasts so long.
Swiss are neutral about war?
They have been Hitler's bitch for years during the world war II,How many Jewish slaves from the Nazi concentration camps have been shiped to Switzerland for human soup production...You figure
"What's important here is stocks are at their highest in a couple of months" - Bob "shitbull" Pisani
How is the dollar down and not UP on all this?? Truely retarded.
It really isn't SD1, you just have to let go of the [fixed] delusion that the dollar is a 'free floating' currency at the mercy of 'markets'. No such animal. Market makers are in control, until one day they aren't. Or they set fire to the currency deliberately which is, to paraphrase Hugh Hendry, a political event not economic/monetary.
Yea well thats pretty much the same as Ive been saying here all along.
Two words - Useful Idiots.. get with the program ZH you are making your readers poorer by the hour
ZH isnt making anyone do anything. Since Ive been on ZH, Im far richer, totaly prepared, and safely out of the rigged vampire casino.
Now scurry on along back to CNBC break time is over Cramer!
So many of these freaking tools all of a sudden. Getting my ass kicked so far this week but still up 32% for year on my two investments---Gold and Spy puts, one of those two definitely ZH approved. In other words, scoreboard bitchez.
You do realize zh offered no investment advice? Forwarding a research report at no cost is a benefit to readers.
The only ones making us poorer by the hour is our govt.
Kill The Dollar.....Save The Banksters......Kill The Dollar.....Save The Banksters.....
With the amazing efficiency inherent in a centrally planned economy, I expect China will be able to rectify this little issue yesterday.
Half the assets of any Chinese bank are non-performing rollovers.
Just like the trans-Atlantic banks.
The difference is every once in a while China takes a banker out back and shoots them in the head.
Sad when infrequent spats of Chinese justice undercut everything wrong in Amerika.
Millions for the Fed's (Red Coats) to chase grungy pot heads in the Emerald Triangle for once of Mother Earth, but NOT ONE PROSECUTION OF A BANKSTER culpable of trillions in fraud.
Now Fast & Furious. This so-called government loses its legitimacy every day.
And the markets just move higher. What else is new.
So basically they are saying Chinese banks are worthless because People's Bank of China didn't give enough fake money like Fed did to the Wall St.? So UBS, CREDIT SUISSE, DEUTCHBANK, GOLDMAN SACHS, BANK OF AMERICA are all so self-sufficient themselves they can write their daily troll report about China all day everyday instead of looking after their shares plunging like failing stone due to their phoney trading.
China-area non-performing !? - under what scenario, China has ten times the growth potential of Europe under any scenario
Well, true. But if the growth of Europe is 0 then 10 x 0 = 0. That is what we are saying here. There is no growth in China with these numbers.
Who's going to buy French bags and German cars if China plunges? Africa?
Yup. AND, if Europe is growing(?) at 0% then China's exports are pretty much shifted downward. Can't push on a string.
Internal growth really isn't growth, it's just self-parasitism (bound to burn out [quicker]). But, increased internal growth will result in decreased trade, which will then mean a decrease in the purchase of US Treasuries, which then means a reduction in available liquidity for the US to cycle back to China (in trade).
People ought not confuse a less negative downward spiral as being a positive (upward) spiral.
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