Author: Nial Gooding

Let me start with my position on Chinese banking NPLs. I believe numbers produced by Chinese banks are too low. The true situation is larger than the numbers suggest; but this is widely understood. Are the numbers as high as some breathless analysis in recent years have suggested (Fitch 20%)? No. Can the problem be […]

Pity China’s migrant workers. As the paper highlighted this Sunday reminds they ‘.. constitute more than one third of the Chinese urban labour force, produce most of the goods exported from China to the rest of the world, and yet are institutionally discriminated against in the Chinese urban labour market. They work much longer hours, […]

China is at a crossroads; if it fumbles next steps a middle-income-trap awaits. The paper highlighted this week is another in the ‘Working Paper’ series from the IMF. This one, by Longmei Zhang from their Asia and Pacific Department, was released last September and highlights some of the pressing problems China now faces and, more […]

Here’s the problem, in a nutshell. The paper highlighted this week is from a team of 13 contributors and was released last October as an ‘IMF Working Paper’. It’s worth a close read for a couple of reasons. First, if you’re new to the subject it gives good perspective on how and why we’ve got […]

The report highlighted this week is an IMF Working Paper prepared by Joong Shik Kang and Wei Liao dated May 2016. At that time slowing Chinese imports were an especially hot topic for commodity and raw material exporters; but the paper still has relevance, and for all of us today. The researchers conclude weaker investment […]

Interested in learning about a strategy that, from July 1953 to December 2015 if implemented, would have generated an annual return of over 20% (with a Sharpe ratio of 1.01)? Jun Li from the University of Texas and Huijin Wang from the University of Delaware  decided to look at an old investment-theory chestnut, the effect […]

Investors the world over know day-1 IPO returns are usually good. Nowhere in the world are they as good as China though. From 1990 to 2013 the average day-1 IPO return was 118.4%. In the paper highlighted this week Wei Tang and Liheng Xui from Fudan University and Tianhao Wu from Yale University looked at […]

According to the study in the paper highlighted this week those in China who profess some sort of religious belief are also more likely to be skeptical of the central administration. Geng Niu and Guochang Zhao of the South Western University of Finance and Economics together with Bosen Ding of Peking University drilled a 2010 […]

I started the paper highlighted this week thinking, hmm, more panda-hugging belly-aching from do-gooders who don’t understand the necessity of the trade off between development and, shall we call it politely, environmental impact? I finished though fully persuaded of the correctness of the authors final summary; ‘Without a fundamental mentality shift among top leaders, the […]

The first High Speed Rail (HSR) train ran in China in 2008 from Beijing to Tianjin on 113km of track. China’s HSR network today, at 18, 000km, is four times larger than Japan’s, 6x larger than France’s and 8x larger than Germany’s. It’s also, literally, infinitely larger than the U.S.’s which is, at present, non-existent. […]

Is there anything to add to volumes of work in recent years on China’s residential property market? To my surprise, reading the paper highlighted this week, I found there is. Researchers Edward Glaeser, Wei Huang, Yueran Ma, and Andrei Shleifer, writing in a National Bureau of Economic Research Working Paper, compare recent developments in China […]

First, it joins the WTO. Then, it begins internationalizing it’s currency. Now, it creates an alternative to the Asian Development Bank (ADB) with capital equal to two thirds of the ADB’s and half of that of the World Bank. Grassy-Knollists would see a pattern here. China is clearly engaged in a long-term bid to displace […]

An obvious point often has to be made before it becomes, well, obvious. In the paper highlighted this week (math heavy and as if ejected from Google translate; but indulge) Wen Shuyang from the Southwestern University of Finance and Economics in Chengdu takes an alternative look at China’s pollution problem. He takes the novel, and […]

The paper highlighted this week asks did price discovery in Shanghai improve after the Shanghai – Hong Kong stock connect introduction in November 2014? Songbin Sohn from Peking University and Na Jiang from Pennsylvania State University set about answering the question by analyzing stocks that trade in both markets, the so-called A-H shares. Because there […]

For many years the free movement of people was seen as a net good (which it is). Locals in Texas would rather do nothing than pick melons and the ‘Polish plumber’ in the U.K. was for a long time a role model of migrant can-do spirit, contributing to the local economy and their own lot […]

A little over a year ago China’s domestic stock markets were in a death-spiral free-fall; and then the government set about restoring calm. Part of a package of measures was a stock purchase program using the agents of the China Securities Finance Corporation and Central Huijin. Not long after the intervention, because so much of […]

What’s especially interesting about the paper highlighted today is when it was written, back in December 2014. Then, Lawrence J. Lau of the Institute of Global Economics and Finance at The Chinese University of Hong Kong, noted overcapacity in the Chinese economy and a savings rate not conducive to encouraging household consumption. Of note, in […]

The paper highlighted this week so neatly fed the tired trope that China’s infrastructure build has been mostly a bad idea it got widespread press coverage last month. Writing in The Oxford Review of Economic Policy Atif Ansar, Bent Flyvbjerg, Alexander Budzier and Daniel Lum, all from Oxford University concluded; ‘..unless China shifts to a […]