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Sunday Papers

The Sunday Paper – How the United States Withdrawal from the Trans-Pacific Partnership Benefits China

The Obama administration worked with 11-nations in Asia over 8-years on the TPP that the Trump administration tore up shortly after the new President’s inauguration. The purpose of the TPP was to create an Asia trading club that included America but excluded China, a club in which America would dictate the rules. China in the […]

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Sunday Papers

The Sunday Paper – Persistent and Transient Inefficiency: Explaining the Low Efficiency of Chinese Big Banks

The Big Five banks in China (Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank and Bank of Communications) control around 40% of system assets. So, if they’re not doing a good j0b it follows the system isn’t operating efficiently. Writing in a BOFIT (Bank of Finland Institute […]

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Sunday Papers

The Sunday Paper – The Partisan Divide in U.S. Congressional Communications After the China Shock

China enters the WTO, U.S. manufacturing jobs begin a rapid decline; coincidence? It seems not. The paper this week, from John Seungmin Kuk, Deborah Siligsohn and Jiakun (Jack) Zhang of the universities of Washington, Villanova and California respectively, digs into the political response to what is now increasingly referred to in the U.S. as the […]

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Sunday Papers

The Sunday Paper – Catching Up in Economic Transition: Innovation in the People’s Republic of China and India

What a difference? On top is China’s R+D investment from 1996 to 2012. Over the period it rose from 0.6% of GDP to the now OECD near-norm of 2%. Below is India’s effort which has stagnated over the period at between 0.6%~0.8% (and the economy is much, much smaller). So China wins, right? Yes, relative […]

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Sunday Papers

The Sunday Paper – The Suspension World of the China A-Shares Market

China is a tricky place in which to invest. China stocks are especially tricky and among the various classes (NASDAQ/NYSE listed, red-chips, p-chips, H-shares, A-shares) the onshore A-shares* are, in my opinion, the trickiest. [As part of my secret-sauce is knowing why this should be so no full argument here. A quiet word over coffee […]

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Sunday Papers

The Sunday Paper – CAPE In China

I’m not a believer in the predictive ability of Cyclical Adjusted Price-to-Earnings or CAPE. I’m suspicious it’s just a highfalutin’ backward induction of the intuitive notion that cheap is good and dear is bad; but that’s just me. Suyang Xu of the University of Maryland has used it in the paper highlighted today to see […]

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Sunday Papers

The Sunday Paper – The IMF’s Annual China Report

Once a year the IMF send a team to talk with policy makers in China to assess the economy, analyze the progress of reform, and offer suggestions that could help planners achieve objectives. They’re kind enough then to share findings with the rest of us. This year’s report was published last Thursday, July 26th and […]

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Sunday Papers

The Sunday Paper – Moving Chairs in Starbucks: Observational Studies Find Rice-Wheat Cultural Differences in Daily Life in China

Is there a difference in people from Northern China versus those from the South in terms of individualistic behavior? Are people from the north more assertive and people from the south more collaborative? Researchers Thomas Talhelm, Xuemin Zhang and Shigehiro Oishi from the University of Chicago Booth School of Business, Beijing Normal University and the […]

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Sunday Papers

The Sunday Paper – The Dynamics of Volatility Connectedness and Implication for Market Integration in China’s Financial Markets

Within the five major financial asset classes in China i.e. stocks, real estate, bonds, commodity futures and foreign exchange which are the ‘dogs’ and which the ‘tails’, or, who wags whom? Researchers Kim Hang Low from the National University of Singapore and Xiaoxia Zhou of the Shanghai University of Finance and Economics looked at data […]

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Sunday Papers

The Sunday Paper – Who Smiles While Alone? Rates of Smiling Lower in China than US

Americans smile more than Chinese. Fact, not just an anecdote. In the paper highlighted this week Thomas Talhelm, Shigehiro Oishi and Xuemin Zhang from the universities of Chicago, Virginia and Beijing Normal respectively studied not only photographs but set about observing students on campuses in Virginia and Beijing to record smiling. The difference between smiling […]

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Sunday Papers

The Sunday Paper – China and the WTO: On a Path to Leadership?

Dr. Marcia Don Harpaz, from The Hebrew University of Jerusalem Faculty of Law believes that China is heading in the direction of WTO leadership. Presently though it lacks, crucially, the ability to assume the role and the willingness of other nations to follow it. WTO leadership in the past has been characterized by two features: […]

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Sunday Papers

The Sunday Paper – China and International Housing Price Growth

Another first. No study to date has attempted to assess the effect of Chinese buyers on real estate markets globally. There have been several one-country studies but in the paper highlighted today researchers Yuk Ying (Candie) Chang, Hamish D. Anderson and Song Shi from the Massey University of New Zealand and the University of Technology […]

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Sunday Papers

The Sunday Paper – Language Commonality and Sell-Side Information Production

Britain and America have been described as countries divided by a common language. How then should we think of China? A country with 17-official language groups that break down into 105-language types; and that’s just official categorizations. Reality is messier. Ruishen Zhang, of the Frankfurt School of Finance and Management, wondered if sell-side analysts covering […]

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Sunday Papers

The Sunday Paper – Inequality in China – Trends, Drivers and Policy Remedies

We all know the story; but seeing this picture prompted an audible ‘Wow!’ from me nonetheless. This is the good news; the near eradication of poverty in China in just 40-years. History contains no precedent, no nation will ever best this. The bad news though is in this process income inequality increased dramatically and in […]

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Sunday Papers

The Sunday Paper – Press Conference on the Conclusion of the 2018 Article IV Consultation with China

The reiteration of a long-held view is often just bigotry or, bigotory’s kissing-cousin, stupidity. However, when analysts modify, or outright change, a position that’s news. This happened last week when an IMF working party consisting of James DANIEL, Mission Chief for China and Assistant Director of the Asia and Pacific Department and Alfred SCHIPKE, Senior […]

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Sunday Papers

The Sunday Paper – Does High-Speed Rail Really Promote Economic Growth? Evidence from China’s Yangtze River Delta Region

You’d think the answer was obvious and ‘of course!’; but you’d be wrong. Or, to be more precise, you’d be only partly correct. Connecting one megalopolis to another is surely a net benefit to both. As soon as a plan is announced though the next question is how many stops will there be on that […]

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Sunday Papers

The Sunday Paper – Value Co-Creation of Xiaomi in China

Think Xiaomi is just a supplier of cheap smartphones? Think again. Writing in the International Journal of Business and Economic Sciences Applied Research, Hsien-Chih Kuo, Pin Luarn and I-Jen Chen from Farestone Telecommunications and the National Taiwan University Science and Technology explain their study of the Xiaomi ecosystem to try and find out how the […]

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Sunday Papers

The Sunday Paper – Disguised Corruption: Evidence from Consumer Credit in China

Corruption, by its very nature, is hard to pin down. In the paper highlighted this week though researchers have used privileged access to a big bank’s data [They don’t say but I’d bet its ICBC] and appear to have flushed out a very interesting variety. Sumit Agarwal from Georgetown University, Wenlan Qian  from the National […]

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Thoughts

Is The Bloom Off China’s High-Tech Rose?

Preamble Investors who bought shares early in today’s China-tech-darlings have done well. If you were in the right stocks, at the right time, heavily weighted your portfolio in that direction and have taken no profits on the way up, you will now be, minted. Congratulations to the lucky few described above. Most investors, however, were […]

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Sunday Papers

The Sunday Paper – Stabilizing China’s Housing Market

The best time to repair a roof is on a sunny day. The paper highlighted today is another in the ‘Working Paper’ series from the IMF and was published in April this year. In it Richard Koss and Xinrui Shi go beyond the tired ohmyGodChinazbuildingtoomuchstuff narrative and take a look at the underlying mechanics of […]