Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: t4texas who wrote (41356)	4/4/2005 3:45:11 PM
From: jim_p	Read Replies (2) \| Respond to of 206115

"This latest boom was driven by a credit binge. Responding to the massive non-performing loans accumulated by Chinese banks in the 1990s, the government ordered they reduce their NPL ratios - bad loans as a proportion of total loans. The move was universally applauded. With hindsight, however, the focus on NPL ratios was a terrible mistake. That is because China's banks are technically insolvent but enjoy high liquidity. To cut NPL ratios, they merely increased the denominator of the ratios: their loans. Lending rose rapidly, driving growth as a side-effect as NPL ratios fell from 28 per cent in 2002 to 13.2 per cent at the end of 2004." news.ft.com