Remove Balance Sheet Remove Productivity Remove Real Estate
article thumbnail

Consultant Ninja: A Simple Question about the Credit Markets.

Consultant Ninja

Heres my understanding of the current TARP/TARPII/PPIP/etc plans: The major "sick" banks wont lend to businesses, because their balance sheets are tied up with bad assets that they cant sell. Productivity. (6). A Simple Question about the Credit Markets. Posted by Consultant Ninja. at 7:39 PM. Labels: Analysis. Consulting. (88).

article thumbnail

Bulls and Bears Debate China: Property Bubble Expands Again; GDP Growth Picks Up; Economic Recovery Underway? No Says Michael Pettis

MishTalk

A series of land sales have set record prices since August, with real estate developers ramping up their competition for the best plots in the biggest cities. Part of it may simply be that few Chinese see any real alternative to real estate as a way of saving. China Rich in Reserves. Pettis Replies.

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

Banks – Industry Overview

Tom Spencer

Business banks: Banks that focus on mid-sized businesses and commercial real estate. Although mortgages do not necessarily pay high interest rates, they do not eat up any capital due to the safety of the financial product and implicit government guarantees. Various other products. Non-interest Income.

Banking 12
article thumbnail

BIS Slams the Fed; Ridiculous Question of the Day: "Is The Fed Going To Attempt A Controlled Collapse?"

MishTalk

Investors’ attraction to riskier credit also spawned greater issuance in assets such as payment-in-kind notes and mortgage real estate investment trusts (mREITs). Historical evidence shows that this rarely happens following a balance sheet recession. Restoring sustainable global growth poses significant challenges.

article thumbnail

China Cash Crunch Eases, For How Long? Three Things China Needs to Avoid; When can Beijing Truly move to Market-Determined Interest Rates?

MishTalk

It is continuing to expand at twice the rate of nominal, or money, gross domestic product, and according to official data has pushed the credit to GDP ratio up to 215 per cent in 2013, and most likely more. One impact of the shadow banking system is an implicit and hidden “reduction” in China’s real minimum reserve requirement.

article thumbnail

Pettis on Strains in China's Banking System; Avoiding the Fall

MishTalk

In either case they reduce consumption demand relative to production. They also tend to be associated with rising stock and real estate markets, which, by making households feel wealthier, encourages higher consumption. But high debt levels change the impact of more productive behavior in at least three important ways.

Banking 63
article thumbnail

Pettis Proposes Savings Glut and Income Inequality are Source of Global Imbalances; Mish vs. Pettis: I Respectfully Disagree

MishTalk

This model rests on an understanding of how distortions in the savings rates of different countries have driven the great trade and balance-sheet distortions with which we are wrestling today, just as they have in most previous global crises, including those of the 1870s, the 1930s, and the 1970s. It does so in two ways.

Banking 56