Another day, another bearish property story……and as Butch Cassidy said to the Sundance Kid “don’t those guys get tried”. Evidently not, and today, the fabulously named, StarRock spoke about a “a very big bubble” in Chinese real estate and BNP Paribas added that house prices in China would fall (but it did not say by how much). More worrying, actually, are the latest estimates of local government loans at $1.6 trillion plus an up-tick in so-called ‘special-mention’ loans at China’s four State-owned banks (these loans are one level above non-performing).
In other news, ICBC has sold all of its Yuan 25 billion of bonds, while varying views on inflation continue. On a more positive note, Shenzhen is to spend $5.9 billion to make a ‘Manhattan’ in the Pearl River Delta and Hong Kong’s house sales have reached the highest in almost three years.
As Butch also said “I got vision, and the rest of the world wears bifocals”.
Shanghai Composite:
Today: -0.46% at 2,643.50 at 11.30
This week: +1.3%
YTD: -19.3%
Hang Seng:
Today: +0.07% at 20,882.54 at 11.57
This week: +1.4%
YTD: -4.5%
Oil futures: $74.75
Gold futures: $1252.10
Euro/$ spot: 1.2819
Headlines
- Local government loans may top $1.62 trillion
- Special-mention loans increase at the four State-owned banks (they are one level above non-performing)
- Property market in China in “very big bubble” says StarRock
- House prices in China to decline starting this month says BNP Paribas (although no number given)
- Shanghai issues regulations on property pre-sales
- China must reform Consumer Price Index calculation methodology, says researcher
- China does not face inflation risk this year, says former PBOC Advisor Fan
- China foreign currency reserves are ‘close to’ 65% in US dollars
- ICBC sells Yuan 25 Billion of six year convertible bonds
- Shenzhen to invest $5.9 billion in Qianhai area, says Securities Times
- Hong Kong house sales increased to highest in almost three years in August
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