China’s Dangerous Usury-Loan Bubble
Follow us on TWITTER: twitter.com Like us on FACEBOOK: www.facebook.com Recently, mainland China media reported that four major state-owned commercial banks had 420 billion Yuan (US0.7 million) less on deposit in its first two weeks of September than they did at in the end of August. Expert pointed out that the money might have gone into the private lending market. There are signs that suggest that these monies were headed for the civilian usury lending market. Meaning, these funds were lent out at exorbitant interest rates and may become the next bubble to pop after the real estate bubble. The consequences of such an event could be catastrophic. On September 22, mainland media reported that China’s four state-owned commercial banks, Industrial and Commercial Bank of China Limited, Agricultural Bank of China, Bank of China, and China Construction Bank, had 420 billion Yuan (US0.7 million) less on deposit in its first two weeks of September than they did at in the end of August. Some expert believed that this 420 billion Yuan (US0.7 million) figure is only about 1.5 percent of the total Chinese savings of 33 trillion Yuan (US.16 trillion), and thus a relatively insignificant number. However, Carolina Aiken, assistant professor of marketing at the University of South indicated that this 420 billion Yuan (US0.7 million) may have been poured into the private lending market. If state-owned banks are also involved in usury, the total money involved can not …
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