By Ray Kwong | China’s economy went from chump to champ in 30 years, with growth rates averaging 10% over three decades. To be sure, there are major downward shifts underway, but predictions that the Chinese economy will go down in flames—whether by crash, hard landing or [your favorite term here]—is crazy. Some detractors even foresee an economic apocalypse, one in which China will repeat Japan’s “lost decade” of stagnation.
Iris Mir | By mid-June the National Audit Office of China released a report unexpectedly detailing the debts of 36 local governments. It unveiled the chilling figure of 3.3 trillion dollar in debt, by the end of 2012. A 13% higher than in 2010. Furthermore, the lack of stimulus investment plans is fuelling scepticism among those who expected the Asian dragon to keep the world economy afloat. Mostly because the priority for China now is to reorient its model of growth with ambitious programs like the new Co2 emissions exchange.
BARCELONA | By CaixaBank research team | The projected improvement in revenue would not be enough to offset rising outlays, taking federal debt to an alarming 200% of GDP by 2037.
MADRID | By Julia Pastor |Portugal and Slovenia’s debt comes back to the dangerous rate of 7%, while S&P’s responsible for EMEA defends that there is no immediate threat to peripheral countries’s debt since some of them have been able to pre-fund its needs.
MADRID | Jorge Holgado at Capitalmadrid | When premium risks go high in a country not everyone loses: insurance companies did a good business last year with Spanish debt, although investment in fixed income is not a short-term strategy of the sector.
LONDON/MADRID | Up to 80 percent of all issuances–some €30 billion so far this year–were bought by non-resident investors, proof that confidence is on its way of being restored.
BARCELONA | The research analysts at la Caixa remind investors of how comfortably (88.2 percent) euro area debt per GDP compares against US’ over 100 percent and Japan’s over 200 percent. But Europe is too unbalanced to survive as it is.
By Joaquim Clemente, valenciaplaza.com | All finance activity planned at the autonomous government of the Valencia region must now be approved by the Spanish Treasury in Madrid before going ahead. If regions in Spain that have sought a bailout from the central administration follow the Valencia pattern, they would have seen their financial rights severely limited as a condition to tap loans from the state agency ICO, a Treasury’s credit…
By Tania Suárez, Madrid | It seems that September will be a busy month, the beginning of a year full of interesting appointments for investors. As noted from JPMorgan, markets have already priced in aggressive Spanish debt buying by the European Central Bank, “but the risks shall remain high.” Many sources agree that the ECB is not expected to provide many details of the SMP. “There’s not a clear indication…
China is willing to help, but everyone has limits. Premier Wen Jiabao told visiting German Chancellor Angela Merkel at a state visit in Beijing on Thursday that Beijing plans to continue buying European sovereign debt, the strongest sign of support for its biggest trading partner in months, although it urged further measures to be taken. “The European debt crisis has continued to worsen, giving rise to serious concerns in the…