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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: DuckTapeSunroof who wrote (424868)	7/9/2003 5:05:03 PM
From: sea_biscuit	Read Replies (1) \| Respond to of 769670

Hmm... Interesting. Do you have some investments in mind for this scenario? I am thinking gold, gold equity funds, and mixed international bond/gold funds like PSAFX.

To: DuckTapeSunroof who wrote (424868)	7/9/2003 5:08:07 PM
From: DMaA	Read Replies (2) \| Respond to of 769670

Don't bet on the Chinese currency: China's State Banks Need $500 Bln Govt Bailout - S&P Mon Jun 23, 4:16 AM ET BEIJING (Dow Jones)--China's state-owned banks urgently need a government bailout estimated at more than $500 billion - 40% of the country's total gross domestic product in 2002 - to help them deal with their bad loans, Standard & Poor's said in report issued Monday. The report, entitled China Banking Outlook 2003-2004, said the sector is incapable of reducing its nonperforming loan ratio of nearly 50% on its own in the short term. "China's "Big Four" state-owned commercial banks are unlikely to reduce their ratios of NPLs to total loans to 15% by 2005 in line with the wishes of the central bank," S&P said. "The country's banking sector, acting alone, will need at least 10 years and possibly as many as 20 to reduce its average NPL ratio to a more manageable 5%." The report said the huge bad debt burden renders the state banks technically insolvent and obstructs government plans to restructure the country's four large state-owned commercial banks - Industrial & Commercial Bank of China, Agricultural Bank of China (Q.AGB), China Construction Bank and Bank of China - into shareholding companies. "Fresh equity is needed if the Chinese banking system is to be placed on a sound commercial footing," the report said. The report suggested that the state bank sector's bad debt burdens continue to defy government efforts to reform the institutions along market-oriented lines. Official statistics indicate that the average bad debt ratio for all of China's banks stood at 19.8% at the end of 2002. Liu Mingkang, chairman of the China Banking Regulatory Commission, said last month that China's four large state-owned banks recorded a 1.99 percentage point decline in their average NPL ratio from the end of 2002 to 24.1% at the end of March. However, S&P said that official statistics seriously underestimate the scale of the bad debt problem facing China's bank sector. "Because China's banks rely on the subjective judgment of credit and loan officers in branches throughout the country, it is reasonable to assume the figures reported are likely to be understated," the report said. "The level of NPLs is (also) likely to be understated because of the highly-politicized nature of statistical reporting in China." story.news.yahoo.com