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Technology Stocks : Cymer (CYMI) -- Ignore unavailable to you. Want to Upgrade?

To: Cymeed who wrote (11778)	12/21/1997 4:47:00 PM
From: Elroy Jetson	Read Replies (2) \| Respond to of 25960

It was CNN that reported that China had just lowered their bank lending rates from 9% to 1%. I haven't seen this confirmed elsewhere and if true, I'm not sure which firms have access to borrow the money. But you have to remember that China, in spite of their bluster at Vancouver, has a banking sector with negative capital if all loans were marked to market. They lent primarily to state companies which are by most measures bankrupt, many "full-time employees" sent home and not paid for months. The lending also went into real estate ventures pushing up the price of real estate. This in combination with a falling currency value lead to inflation. China does have large reserves of foreign currency so they are not a charity case like Korea. Some even forecast that China will lead Asia out of their slump. But to me this seems optimisitc to expect this from a country where Coca-Cola and Marlboros are luxury goods most can't afford. By lowering lending rates to 1%, China postpones a collapse of the banks and state firms.