AdvancingTime
Senior Member
- Feb 8, 2015
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World markets are spooked and unwinding the bets they have placed over the years. China looks to be in for an extremely bumpy ride as a lot more investors question the risk of holding yuan assets. The general consensus held by everyone from deposit holders in Hong Kong to high-yield-bond investors in Europe was this would continue. Over the years this has pushed along the misallocation of credit on a grand scale and continued the build-up of bad assets in the banking sector.
An estimate by Goldman Sachs has indicated China might be facing credit losses of as much as $3 trillion as defaults ensue from the expansion of the past four years. Nomura claims $90 billion left the country in July with the pace accelerating since the People's Bank Of China shocked the world by ditching its currency peg to the U.S. dollar. Capital flight for the first three weeks of August may be approaching $100 billion despite the use of harsh anti-terrorism and money-laundering laws to curb illicit flows. More about this shift and its implications in the article below.
Advancing Time: China's Massive Capital Outflows
An estimate by Goldman Sachs has indicated China might be facing credit losses of as much as $3 trillion as defaults ensue from the expansion of the past four years. Nomura claims $90 billion left the country in July with the pace accelerating since the People's Bank Of China shocked the world by ditching its currency peg to the U.S. dollar. Capital flight for the first three weeks of August may be approaching $100 billion despite the use of harsh anti-terrorism and money-laundering laws to curb illicit flows. More about this shift and its implications in the article below.
Advancing Time: China's Massive Capital Outflows
