Subscribe for 12 months with recurring billing - $199

Buy 12 months of subscription time - $199

 

Search Gold Prices
Gold Price
[Most Recent Quotes from www.kitco.com]
Our RSS Feed

Gold Updates by Mail

Enter your email address:

Follow Us on Twitter
« U.S. jobs, inflation data support tapering of Fed bond buying | Main | The US$ Outperforms Gold, Silver and the HUI so far in 2013 »
Wednesday
Aug142013

Shanghai Surprise

by David Franklin, dfranklin@sprott.com


The Economist recently reported that The Industrial and Commercial Bank of China (ICBC) displaced Bank of America to become the world’s biggest bank in 2012, marking the first time in history a Chinese bank has reached this pedestal. China now has four of the world’s ten biggest banks.1

Together, these Chinese banks have a combined market capitalisation of close to $1 trillion Canadian dollars, or three times the market cap of the Canadian banking sector. ICBC alone has 393 million individual customers, which according to the Telegraph is the equivalent of a single bank managing the bank accounts of every man, woman and child in Western Europe.2 In fact, Chinese banking sector assets have increased by $14 trillion since 2008, which is the entire size of the US commercial banking sector. China is a global banking force to be reckoned with.

From the outside, however, observing the Chinese banking system can be “like watching two dogs fighting under a carpet.” It's clear that something is happening, but it’s hard to tell exactly what .3

June 19, 2013 will go down in Chinese banking history as the day that overnight borrowing rates hit a record high 25%, thus effectively freezing the Chinese credit market.4 Under normal market conditions, the SHIBOR - which is the rate at which Chinese banks are willing to lend to each other for short periods of time – is typically less than 3%. Expert opinion is sharply divided over both the causes and implications of these skyrocketing lending rates.

To read this artcile in full please click here.

 ................

With gold, silver and Uranium stocks being out of favor one must decide if this is a problem or an opportunity. We have steadfastly refused to buy gold and silver mining stocks for the last two years and as evidenced by the HUI we feel that our decision to hold back has been vindicated. The damage done to the mining sector may not be over yet but this demise is starting to offer up some exciting opportunities in my view.

 

Great care will be needed in the selection process in order to generate a reasonable profit and that’s where our new venture begins. ‘Stock Trader’ has begun trading on behalf of ourselves and our much valued subscribers, all exciting stuff which we are really looking forward to, if you wish to join us then please subscribe below;

Subscribe for 12 months with recurring billing - $199

Buy 12 months of subscription time - $199

Don’t forget if you are new to investment in the precious metals sector then you can subscribe of our FREE newsletters regarding gold stockssilver stocks and uranium stocks, just click on the links and enter your email address and we will email you our articles along with other interesting posts.

Please remember to check your spam folder once you have subscribed to ensure that your verification has not gone astray and you are getting our emails.

PrintView Printer Friendly Version

EmailEmail Article to Friend

Reader Comments

There are no comments for this journal entry. To create a new comment, use the form below.

PostPost a New Comment

Enter your information below to add a new comment.

My response is on my own website »
Author Email (optional):
Author URL (optional):
Post:
 
Some HTML allowed: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <code> <em> <i> <strike> <strong>