Topic: [2014-01-20] China is heading towards a default. Potential good news for Bitcoin (Read 1271 times)
January 21, 2014, 04:41:10 AM
There is undoubtedly no mention of Bitcoin in this article.
January 20, 2014, 11:34:27 AM
You need to fix the title. The title of the article is "Mega Default In China Scheduled For January 31", not the one you have.
Anyway, you are wrong. China Credit Trust Co. is not China.
Anyway, you are wrong. China Credit Trust Co. is not China.
January 20, 2014, 11:33:29 AM
Actually, they will have their problems to deal with - interbank lending most notably - but I don't think they're going to have too much to worry about. The Western perspective on the Chinese banking system is no doubt rife with a "we do it better" attitude, when most major banks in the USA are leveraged over what they should be, thanks to the dissolving of the barriers to banks doing investment trading and co-mingling funds.
The biggest difference between China and the USA is China will let a bank fail, and the survivors pick up the pieces. This means they lower their systemic risk, instead of papering over it like the USA with TARP and other idiotic "asset relief programs" that merely kick the problem down the road, while increasing the probability of it taking the system down again.
Edit: My mistake, its a trust - not a banking product - the run-down is here:
http://www.zerohedge.com/news/2014-01-19/bank-america-actively-preparing-chinese-january-31-trust-default
There is concern it will affect the Chinese Yield Curve in addition to some contagion concerns. Still, I think the PBOC will have to let it fail instead of trying to bail it out.
The biggest difference between China and the USA is China will let a bank fail, and the survivors pick up the pieces. This means they lower their systemic risk, instead of papering over it like the USA with TARP and other idiotic "asset relief programs" that merely kick the problem down the road, while increasing the probability of it taking the system down again.
Edit: My mistake, its a trust - not a banking product - the run-down is here:
http://www.zerohedge.com/news/2014-01-19/bank-america-actively-preparing-chinese-january-31-trust-default
There is concern it will affect the Chinese Yield Curve in addition to some contagion concerns. Still, I think the PBOC will have to let it fail instead of trying to bail it out.
January 20, 2014, 08:07:30 AM
That's not a default if china (china can't default since it prints its own money), if I understand correctly it just the default of a fund.
Anyway if there is a big default that means deflation and hence lower prices (even for bitcoins).
Anyway if there is a big default that means deflation and hence lower prices (even for bitcoins).
January 20, 2014, 07:53:03 AM
American smugness and arrogance in 3.... 2..... 1.....
January 20, 2014, 05:45:38 AM
I have been watching this development for a few hours since i saw a link to a Forbes article on it.
Google News now has abut three others. I agree, this is serious and will probably lead to a pop in price, if it is allowed to happen. However, it appears that the market is assuming that there will be some kind of bailout. Nevertheless, from what i can tell, one of these shadow banking deals will not be able to be averted and it will have the major affect that you foresee for the price of bitcoins.
Google News now has abut three others. I agree, this is serious and will probably lead to a pop in price, if it is allowed to happen. However, it appears that the market is assuming that there will be some kind of bailout. Nevertheless, from what i can tell, one of these shadow banking deals will not be able to be averted and it will have the major affect that you foresee for the price of bitcoins.
January 20, 2014, 03:48:33 AM
http://www.forbes.com/sites/gordonchang/2014/01/19/mega-default-in-china-scheduled-for-january-31/
Looks like China is headed for some sort of huge default on January 31st. Could be good news for Bitcoin since they buy them up like crazy.
Looks like China is headed for some sort of huge default on January 31st. Could be good news for Bitcoin since they buy them up like crazy.
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