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Financial Sector

28
Jan

The Sustainability of China’s Pension System… or Lack Thereof

According to 2019 survey data, the broader topic of social security represents the #3 area of interest of the average Chinese citizen at this point in time, with the rule of law occupying position #2 and corruption being the #1 culprit. Upon reconciling 2019 data with numbers from previous years, we end up realizing that

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15
Jan

Is “Bad Debt” (Only) Piling Up in China?

After the (in)famous Great Recession of 2007-2008, the average observer started paying more and more attention to the banking system. Why? Simply because the Great Recession made it clear that there are visible cracks in the financial system, anything from a quasi-incestuous relationship between the financial system and the banking system to issues pertaining to

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06
Jan

Facebook’s Libra Crypto Project from a Chinese Perspective: Will China Play Ball?

Before trying to form an opinion on Facebook’s Libra cryptocurrency project and what it looks like from China’s perspective, we would strongly recommend reading three of our previous articles: First of all, an article through which we have explained why China has a love-hate relationship which is actually quite a bit closer to the “hate”

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25
Dec

(How) Can Bank Runs Occur in China?

As peculiar as it may seem, many analysts believe that one of the “perks” associated with authoritarian governance is represented by the fact that one can “have everything under control” when it comes to the main follies of capitalism: excessive greed, excessive fear, manic-depressive behavior which leads to anything from irrational exuberance on the way

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02
Dec

The People’s Bank of China (PBOC) vs. Western Counterparts

The People’s Bank of China (abbreviated PBC, or more commonly PBOC) has been the world’s “richest” central bank by asset valuation since July of 2017, a valuation north of $3 trillion at the moment of writing. Just like any other central bank, the PBOC has responsibilities with respect to setting monetary policy and acting as

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02
Oct

(Financial) Fraud in China: How to Avoid Portfolio-Disrupting Scams

When it comes to financial crimes committed within China, the laws at least (even if the efficiency of the authorities with respect to applying them can sometimes be questionable) are very strict and as such, a valid case can be made that a strong legislative disincentive exists. But as far as laws that pertain to

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18
Sep

Is China on the Verge of Becoming a Cashless Society?

Finding out that China was the first nation to introduce banknotes comes a surprise to many and it tends to come as even more of a surprise for the average Western observer to hear that yes, China is genuinely on the verge of becoming a cashless society, with over two-thirds of its citizens having switched

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09
Jul

China’s 2015-2016 Stock Market Crash and Its Consequences

On the 5th of June 2015, a severe market crash started from which China has not been able to fully recover. On the contrary, despite a recovery starting as of February of 2016, prices were not able to get anywhere near their pre-crash highs and, in fact, they went to new lows toward the end

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07
Jul

China’s Banking System: Past, Present and Future

We’ve covered various concerns pertaining to China’s shadow banking system in a previous article, so it makes sense to also pay attention to… well, its “actual” banking system. And, right off the bat, let’s just say the “Past” dimension of this article will be very brief, for the simple fact that there isn’t really all

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06
Jul

Shadow Banking in China: Is Enough Being Done?

In 2019, we can confirm the first full-year decline in terms of Chinese shadow banking volume in over 10 years (2018 compared to 2017), after the authorities started paying serious attention to this dimension of the financial sector as of 2017. Still, we’re looking at a whopping $9.1 trillion in outstanding shadow banking loans, which

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