1997 Asian Financial Crisis, Redux? Bamboo Innovator is featured in BeyondProxy.com, where value investing lives

Bamboo Innovator is featured in BeyondProxy.com, where value investing lives:

  • 1997 Asian Financial Crisis, Redux? Aug 28, 2013 (BeyondProxy)

AFC

Why $3.4tn in foreign reserves is not China’s escape hatch

Why $3.4tn in foreign reserves is not China’s escape hatch

Guest writer | Aug 28 08:40 | 5 comments | Share

By Paul J. Davies, the FT’s Asia financial correspondent.

After trying to work out how big China’s bad debt problem might be, many people still turn round and point to the country’s mammoth foreign exchange reserves as its great get-out clause. The idea is seductive. On a deliberately gross calculation using the 20 per cent non-performing loan rate found at China’s big banks in the late 1990s, total bad debts would amount to Rmb21tn. A more sensible stab might put the level at roughly half that, or Rmb10tn. These are painfully large numbers – but hang on, China’s central bank has foreign exchange assets of $3.4tn, or Rmb20tn. Perfect – what’s the problem? Read more of this post

Beijing land values surpass US annual GDP

Beijing land values surpass US annual GDP

Staff Reporter

2013-08-28

Transaction prices in China’s urban housing market have touched new highs in 2013, such as Beijing, Shanghai, Guangzhou and Hangzhou. In Sunhe, located in the Zhaoyang district in Beijing, Cofco Property, spent 2.36 billion yuan (US$385 million) on July 23 this year to buy an HIJ plot, measuring 33,000 square meters. The floor area was priced at 44,000 yuan (US$7000) per square meter, making it the most expensive plot of land in the capital. On Aug 16, China Resources won the bid for a plot of land in Qianhai, Shenzhen for 10.9 billion yuan (US$1.7 billion), which broke the record for the highest price quoted for a single land transaction. Read more of this post

“China has made too many mistakes, and urbanization in several places is not even real”

Urbanization in parts of China slower than Vietnam

Staff Reporter

2013-08-28

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Ren Zhiqiang, right, attends a meeting in Hainan. (Photo/Xinhua)

Until China solves its problems of household registration and land issues, urbanization in certain parts of the country will still be slower than those found in Vietnam, said a Beijing party official. “China has made too many mistakes, and urbanization in several places is not even real,” said Ren Zhiqiang, who also doubles as the chairman of Huayuan, a real estate company based in Beijing. Ren suggested that China allows people to have access to all the resources related to urbanization. “First, the industry has to become a free market. Second, the government should give people the right to change their residence,” he said. “Many in China blame real estate companies for resources being unequally allocated. But the government is actually the one to be blamed, because it caused the country’s urbanization to be slower than other Asian countries, Vietnam for example,” he said.

 

Why Etsy’s brave new economy is crumbling

Why Etsy’s brave new economy is crumbling

By Kevin Morris on August 27, 2013Email

One of the biggest consumer markets in the world resides in a river valley about 200 miles southwest of Shanghai. You can find almost anything you want in Commodity City’s half-million stalls: baby bibs, knitting suppliessundry types of underwear, T-shirts, glitzy jewelry. The market is the literal and figurative heart of Yiwu, a metropolis of 1.3 million people that bustles under the sticky, industrial haze of Zhejiang province. Journalist Tim Phillips has called Yiwu the “Wall Street” of China’s counterfeit goods industry—an accurate, if somewhat narrow, label. The city’s factories flood the shelves of Commodity City and the rest of the world with a lot more than just knock-off iPhones and pirated Hollywood DVDs. They relentlessly pump out the type of cheap consumer goods you’re used to seeing at shopping mall kiosks and street-side trinket stands. Read more of this post

Web Sales Remain Small for Many Retailers

August 27, 2013, 8:31 p.m. ET

Web Sales Remain Small for Many Retailers

SHELLY BANJO and PAUL ZIOBRO

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Nearly two decades after the Web revolutionized shopping, many big retailers are still struggling to turn the Internet into a big part of their business. Their progress is on display in new correspondence between the Securities and Exchange Commission and a bevy of chains, including Target Corp., TGT -1.36%Wal-Mart Stores Inc., WMT -0.23% PetSmart Inc. PETM -0.48% and Fifth & PacificCos. FNP -2.57%. In the correspondence, the SEC asks the companies—which frequently tout their online prowess—to provide hard details about the amount of goods they sell online. Read more of this post

China’s Transparency Standards, U.S. Investor Expectations Collide; Government Policy Curtails Scrutiny of Links Between Officialdom and Business

Updated August 27, 2013, 1:44 p.m. ET

China’s Transparency Standards, U.S. Investor Expectations Collide

Government Policy Curtails Scrutiny of Links Between Officialdom and Business

JAMES T. AREDDY

SHENZHEN, China—In the almost six years since VisionChina Media Inc.VISN -4.15% raised $115 million in a U.S. initial public offering, the Chinese broadcasting company hasn’t told U.S. investors its co-founder is the daughter-in-law of a senior figure in the Chinese Communist Party. Should it have? The omission is legal. But it illustrates wide differences between China’s transparency standards and U.S. investors’ expectations. The issue of Chinese political interests overlapping with business comes as inconsistencies pile up over how the U.S. and China treat information. Over the past year, Beijing and Washington have butted heads over jurisdiction to regulate auditors and enforce legal rulings. Accusations by U.S. hedge funds that several China-based, U.S.-traded companies engaged in fraudulent accounting have erased billions of dollars in market value, also hitting shares of companies not accused of wrongdoing. More recently in China, one scandal after another has highlighted ties between business and the relatives of politicians. Read more of this post

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