Chinese Capital Markets Frozen As Bad Loans Soar To Highest Since Crisis

Chinese Capital Markets Frozen As Bad Loans Soar To Highest Since Crisis

Tyler Durden on 02/14/2014 14:05 -0500

Chinese capital markets are quietly turmoiling as debt issues are delayed and demand for “Trust” products – the shadow-banking-system’s wealth management ‘investments’ – is tumbling. As Nikkei reports, since January, 9 companies have postponed or canceled issuance plans (around $1 billion) and is most pronounced in privately-owned companies (who lack an implicit government guarantee). This, of course, is exactly what the PBOC wanted (to instill some fear into these high-yield investors – demand – and thus slow the supply of credit to the riskiest over-capacity compenies) but as non-performing loans in China surge to post-crisis highs, fear remains prescient that they will be unable to “contain” the problem once real defaults begin (as opposed to ‘delays of payment’ that we have seen so far).

Via Bloomberg,

Chinese banks’ bad loans increased for the ninth straight quarter to the highest level since the 2008 financial crisis, highlighting pressures on asset quality and profit growth as the world’s second-largest economy slows. Read more of this post

Japan’s Rakuten buys chat app Viber for $900 million to expand digital empire

Japan’s Rakuten buys chat app Viber for $900 million to expand digital empire

5:10am EST

By Chang-Ran Kim

TOKYO (Reuters) – Japanese e-commerce giant Rakuten Inc, controlled by billionaire Hiroshi Mikitani, will buy call and messaging app provider Viber Media Inc for $900 million in a deal that would more than double the number of users in its digital empire. Read more of this post

Prem Watsa “China Reminds Me Of US Housing In Boom”

Prem Watsa “China Reminds Me Of US Housing In Boom”

by VW StaffFebruary 14, 2014, 12:49 pm

Prem Watsa – Fairfax Financial Holdings Ltd (TSE:FFH) – Chairman and CEO on FFH conference call this morning.  Watsa discusses the state of the company with a “year in review” flavor, and looks to the future with a particular emphasis on China.  See  Prem Watsa: China Has Biggest Housing Bubble in History

Prem watsa Fairfax financial’s year end conference call

Thank you, Rick. Good morning, ladies and gentlemen. Welcome to Fairfax Financial Holdings Ltd (TSE:FFH)’s year-end conference call. I plan to give you some of the highlights and then pass it on to Dave Bonham, our CFO, for additional financial details. Read more of this post

Delhi Chief Minister Kejriwal resigns to protest the blocking of an anti-corruption Bill, less than 50 days after taking office in the Indian capital.

Delhi Chief Minister Kejriwal resigns

POSTED: 14 Feb 2014 23:19
Delhi Chief Minister Arvind Kejriwal announced his resignation on Friday to protest the blocking of an anti-corruption Bill, less than 50 days after taking office in the Indian capital.

NEW DELHI – Delhi Chief Minister Arvind Kejriwal announced his resignation on Friday to protest the blocking of an anti-corruption Bill, less than 50 days after taking power in the Indian capital. Read more of this post

Singapore SMEs start to push back at rising rents; ASME head bemoans ‘cartel’ of institutional landlords using ‘draconian measures’

PUBLISHED FEBRUARY 14, 2014

BUDGET ROUNDTABLE ON VIDEO

SMEs start to push back at rising rents

ASME head bemoans ‘cartel’ of institutional landlords using ‘draconian measures’

TEH SHI NING TSHINING@SPH.COM.SG

[SINGAPORE] Singapore’s small and medium-sized enterprises (SMEs) are getting proactive about the mounting rent pressures they face.

The Association of Small and Medium Enterprises (ASME) is studying the feasibility of a database to track industrial and retail rents. This would record effective rents rather than contractual ones, providing greater transparency for SMEs and their landlords, ASME president Kurt Wee said at BT’s Budget Roundtable. Read more of this post

Jakarta: The Luxury Property Capital of the World

Jakarta: The Luxury Property Capital of the World

By Josua Gantan on 4:05 pm February 13, 2014.
Jakarta. Nowhere in the world offered a better return on high-end property investment in 2013 than Indonesia’s capital, a leading global real-estate consultancy based in London said.

“The growth of the economy and the property sector might get slower — it depends on the global outlook — however, we remain positive on the Indonesian market,” Hasan Pamudji, Knight Frank Indonesia’s associate director for consultancy and research, told Jakarta Globe. Read more of this post

Can Indonesia Educate Itself Out of Middle-Income Status?

Can Indonesia Educate Itself Out of Middle-Income Status?

By Daniel Suryadarma on 6:36 pm February 13, 2014.
After successfully expanding their economies from low- to middle-income levels, many developing countries now face the risk of falling into the “middle-income trap.” The IMF defines this as “the phenomenon of hitherto rapidly growing economies stagnating at middle-income levels and failing to graduate into the ranks of high-income countries.” Read more of this post

Jakarta’s Garbage Time Bomb

Jakarta’s Garbage Time Bomb

By Harriet Conron on 11:11 am February 13, 2014.
Carts of rubbish line the streets surrounding the Rawasari waste separation facility. Inside, men work quickly, hungrily dissecting piles of rotting garbage with pitchforks, separating recyclable waste from biodegradable matter, and trash destined for Bantar Gebang.

Snatches of upbeat banter and laughter mingle with the flying baskets of rubbish, and in the rush occasionally pieces of glass, plastic and green waste end up in the truck with the landfill. Read more of this post

The promoter problem in Indian banks

The promoter problem in Indian banks

David Keohane

| Feb 14 10:55 | Comment | Share

Or — watch the rate of stressed asset growth in the industry:

That’s from Goldman, they of the Modi-fied viewpoint. You can check out United Bank of India for more… Read more of this post

Xi Touts Communist Party as Defender of Confucius’s Virtues

FEBRUARY 13, 2014, 12:44 AM  10 Comments

Xi Touts Communist Party as Defender of Confucius’s Virtues

By CHRIS BUCKLEY

Xi Jinping wants you to memorize “The Analects” of Confucius. China’s Communist Party chief says that the homegrown thoughts of the ancient sage offer an antidote not just for his own country’s ills, but also for Western societies whose faith in capitalism has been battered by the economic slump. Read more of this post

Pimco’s El-Erian: U.S. Could Become Japan

February 14, 2014, 8:30 A.M. ET

Pimco’s El-Erian: U.S. Could Become Japan

By Jack Otter

Mohamed El-Erian, the outgoing CEO and co-CIO at Pimco, said at a conference Thursday that the U.S. was in danger of “becoming Japan” if Congress cannot get over its dysfunction and take action to spur growth. El-Erian, speaking with CBS business analyst Jill Schlesinger at a LinkedIn conference in Manhattan, warned that the U.S. economy cannot be supported forever by the Federal Reserve alone. Read more of this post

Even Among the Richest of the Rich, Fortunes Diverge; our 0.1 percent household made about 206 times, and our 1 percent household about 41 times, what our average household did.

Even Among the Richest of the Rich, Fortunes Diverge

By ANNIE LOWREYFEB. 10, 2014

WASHINGTON — YES, we know the economic fortunes of the 99 percent and 1 percent have diverged over the last three or four decades. But the fortunes of the 1 percent and the 0.1 percent, or the 0.01 percent, or the 0.001 percent, have diverged even more. Economists have taken to calling it “fractal inequality.” It is not just that the rich have pulled away from the average American. It is that the richer you are, the more you have pulled away. Read more of this post

A World Unprepared, Again, for Rising Interest Rates

A World Unprepared, Again, for Rising Interest Rates

FEB. 11, 2014

Eduardo Porter

MEXICO CITY — I was living in São Paulo in 1997 when, out of the blue, aninvestment banker I knew in London called to ask about Brazilian cocktails. He didn’t want one. He needed a name for a potential economic crisis, in the vein of Mexico’s Tequila affair in 1994 and Thailand’s Tom Yum Kung debacle, which was unfolding at the time. Read more of this post

When Investor Websites Get Duped; Seeking Alpha’s policy of granting anonymity to writers of stock stories can have troubling consequence

THURSDAY, FEBRUARY 13, 2014

When Investor Websites Get Duped

By JOHN KIMELMAN | MORE ARTICLES BY AUTHOR

Seeking Alpha’s policy of granting anonymity to writers of stock stories can have troubling consequences.

In recent years, Website Seeking Alpha has emerged as a watering hole for both positive and negative stories about stocks. Read more of this post

$1.8 trillion in trust products may be headed for default this year

$1.8 trillion in trust products may be headed for default this year

By Gwynn Guilford @sinoceros February 13, 2014

Last month, China’s banking sector dodged a potential catastrophe when a mystery group stepped in at the 11th hour to pay investors in the now-infamous “Credit Equals Gold #1, a defaulted $495-million trust product. Barely two weeks have passed and now another trust product has failed to pay back investors. Read more of this post

Property speculators in Wenzhou hit by plummeting prices

Property speculators in Wenzhou hit by plummeting prices

Staff Reporter

2014-02-14

The resale market for housing in Wenzhou was badly hit following the government’s second round of cooling measures announced in September 2010, with the city having posted the country’s sharpest decline in prices after recording the highest appreciation, state broadcaster China Central Television (CCTV) reports. Read more of this post

Unaffordable cities: Singapore workers tread water on millionaires’ island; With 17% of city state’s residents worth S$1m, those who serve, drive and treat them may as well live on another planet

Unaffordable cities: Singapore workers tread water on millionaires’ island

With 17% of city state’s residents worth S$1m, those who serve, drive and treat them may as well live on another planet
Marc Nair in Singapore

theguardian.com, Thursday 13 February 2014 07.00 GMT

It is a balmy Saturday afternoon in the suburbs of Singapore. Patricia, 21, and her partner Sham, 28, share their first meal of the day: a box of chicken nuggets at McDonald’s. “It’s getting much harder to survive in Singapore,” Patricia says between bites. “I love my job, but my pay doesn’t match up to the cost of living here. But what choice do I have?” Read more of this post

Korea’s CJ billionaire chairman gets 4 years in jail, $24 million fine

CJ chairman gets 4 years in jail, $24 million fine

Feb 15,2014

	CJ Group Chairman Lee Jay-hyun leaves the Seoul Central District Court yesterday in a wheelchair after being fined and sentenced to four years behind bars. [NEWSIS]

A Seoul court yesterday sentenced CJ Group Chairman Lee Jay-hyun to four years in prison and ordered him to pay a 26 billion won ($24.4 million) fine for massive embezzlement, tax evasion and breach of trust, disappointing the country’s 14th-largest conglomerate and signaling that courts will continue to play hard ball with business moguls breaking laws.
“The defendant avoided paying taxes amounting to 26 billion won by wielding his influence as the biggest shareholder [in CJ Group],” said presiding judge Kim Yong-gwan during a verdict deliberation at the Seoul Central District Court.
The judge added that Lee created slush funds worth nearly 60.3 billion won for personal use through misappropriation of company funds in a systematic and secretive way. The court also accepted the prosecutors’ claim that Lee created paper companies offshore to transfer his illegally amassed fortune to their accounts in order to avoid paying taxes.  Read more of this post

Certified public accountants lose former prestige in S. Korea

Certified public accountants lose former prestige in S. Korea

Yong Hwan-jin

2014.02.14 17:58:34

South Korea is about to have 20,000 certified public accountants (CPAs). The country has 16,000 CPAs in total now, according to the Korean Institute of Certified Public Accountants. The number of accountants more than tripled from 5,000 CPAs in 2004. Given that the number of CPAs rises nearly 1,000 every year, 20,000 people are forecast to have the CPA licenses in 2016. 
CPA licenses have lost their earlier charm. An entry-level CPA earns about 38 million won ($35,802), lower than 40 million won a counterpart earns at Samsung Electronics. In the 1990s, an entry-level CPA made 40 million won, overwhelmingly larger than 18 million won a counterpart received at the tech company.  Read more of this post

Why China’s banking system is in so much trouble; The full transcript of the Telegraph interview with China expert Charlene Chu

Why China’s banking system is in so much trouble

The full transcript of the Telegraph interview with China expert Charlene Chu

By Harry Wilson, Banking Editor

3:31PM GMT 14 Feb 2014

How bad are the problems in the shadow banking sector?

I’ve been pretty concerned at what’s going on in China since the start of the global crisis and the start of the credit boom. One of the facts that has always been an issue is that more and more credit is being extended through shadow banking channels, the trust companies being the most prominent of those.  Read more of this post

Is Aldi doing to Tesco what Ryanair did to British Airways? The growth of Aldi and Lidl looks to be a permanent change in the way Britain shops, rather than a blip

Is Aldi doing to Tesco what Ryanair did to British Airways?

The growth of Aldi and Lidl looks to be a permanent change in the way Britain shops, rather than a blip

By Graham Ruddick

6:39PM GMT 13 Feb 2014

Deepdale, the home of Preston North End, is a football ground steeped in history thanks to its association with the former England winger Sir Tom Finney. But from December, the area has also provided a glimpse into the future for Britain’s supermarkets. Read more of this post

S.E.C.’s Review of Stock Trading Will See Some of Its Own Work; The agency may have helped create the problem it is now hoping to solve

FEBRUARY 11, 2014, 5:32 PM  1 Comment

S.E.C.’s Review of Stock Trading Will See Some of Its Own Work

By STEVEN M. DAVIDOFF

There are now at least 58 stock exchanges in the United States, many of them dark pools where the trades can be made anonymously. Withinstitutional investors claiming they are outgunned by high-frequency traders, and individual investors adrift in fragmented markets, it’s no wonder that Mary Jo White, the new head of the Securities and Exchange Commission, is moving to review and overhaul how stocks are traded. The issue is that the S.E.C. may have created the problem it is now hoping to solve. Read more of this post