Mish, The difference between the <<China Construction Bank>> and Fannie Mae may not be that great to be noticed.
I understand that the each of the troubled bank branches are selecting one person to make a run, with some get-away money (a few million to several tens of millions), and take the blame. Ingenious.
Chugs, Jay
P.S. BTW, Stratfor, as usual, is late with the facts, mentioned here worldmarket.blogspot.com on March 6th
<<(f) After returning home, I caught up with some China private sector tycoon living in Hong Kong, had dinner, and got some desperately dire news which connected the dots on other news of the media variety, and I say, “oh my golly, DEFCON 5, all-systems alert, weapons ready, and bunkers stocked”. Here are the bits and pieces:
o There has recently been a sharp increase of Chinese bankers getting arrested, running away, committing suicide;
o The hyped Chinese banking IPOs, earlier a hot subject of conversation, seem to have disappeared off the map of the media;
o It appears that the preparations for the IPOs necessitated large due diligence and audit teams to simultaneously do system-wide reviewing of the books, and (drum roll sounds, interspersed by noise of explosions) it appears that perhaps as many as 5 out of 6 bank branches of all banks in some localities, like their brokerage cousins, are bankrupt, the staff in these facilities are rotten from the top to the bottom since cooking the books on the apparent scale necessarily involve everyone in the building. It also appears that there is branch-to-branch and bank-to-bank cooperation of the doomed, as they previously had shuffled deposits amongst themselves ahead of audit team visits, showing credits but not debits, filling in the void with temporary infusion of fiat moolah.
o The simultaneous checking up of many branches turned up much more than expected, and more than can be imagined.
(g) The folks in the know think about the possibilities:
o Financial collapse must be avoided at all cost, possibly first by printing;
o As the central government may depend more on the strong regional governments, the power base may become more encompassing; and
o Desperation triggered, and emergency justified political reform may be just around the 12-24-months corner.>> |
