China Tells

This Article was originally published on Business Times.

A lot has been said about the potential rescue from China to the current European debt mess. For example, Mr Yu Yongding, a former member of China’s central bank monetary policy committee, wrote in Financial Times (Oct 31, 2011) that “Beijing will not ride to eurozeone’s rescue”.

I would argue the opposite in this article. To understand this issue more deeply, one need to start with a few numbers.

As of Oct 2011, China held a total foreign reserve worth of about 3.2 Trillion US Dollars, with a wide margin ahead of other governments with large foreign reserves such as Japan (less than 1.5 Trillion USD) and Russia (about 500 Billion USD). During January 2011 to September 2011, China has accumulated 354 Billion USD worth of foreign reserve, which was equivalent to about 1.3 Billion USD per day and almost 1 million USD per minute. Continue (继续)

The CEO of Woodsford Capital Management Pte Ltd, Wu Zhijian, has been interviewed by Hedge Week to discuss the regulatory environment in Singapore for Hedge Funds.

伍治坚接受Hedge Week专访并发表对新加坡基金法规环境的看法。

The Interview can be downloaded from HERE.

China’s addiction to GDP growth can be traced back to 1992, more than a decade after the first stirrings of a market economy were launched with the establishment of the special economic zones. The student protests and subsequent clampdown in Tiananmen Square in Beijing in 1989 led many in China’s leadership to question the idea of opening up to the outside world. They worried that the introduction of capitalist-style reforms would inevitably weaken the political structure and so the atmosphere was tight and cautious as China entered the 1990s.

Now technically retired from his role in the leadership, Deng took it upon himself to revitalize the reforms he had first put in motion. On a tour of Shanghai, Shenzhen and other cities that had already seen some of the benefits he foresaw for the country from the reform program, Deng told audiences that for China, “growth is the first principle.” He reassured Communist Party members that the leadership would support local efforts to open up the economy and encouraged everyone to continue with the reforms he had started. The official media gave blanket coverage to the tour and speeches, ensuring that Deng’s words would be taken as party doctrine. Continue (继续)

此文原载联合早报

种种迹象表明，如果欧洲政府和中央银行再不采取果断的措施，世界经济很有可能再次跌入衰退的深渊。 很多人对2008年的金融风暴仍然记忆犹新，但是我们今天面临的境况可能比2008年还要严重。主要原因有三：首先，2008年的金融危 机始发于美国，当时的美联储和联邦政府财政部为了应对危机，采取了强有力的措施，比如在短时间内通过TARP（Troubled Asset Relief Program）以及联储的第一次量化宽松。这次的金融危机更多源于欧洲，而由于欧洲独特的政治体制，以及其央行对待危机不同的态度，很难像美国那样，在 短时间内通过大规模的金融方案以稳定市场的信心。

其次，2008年金融危机的时候，全球各国央行纷纷降息，政府纷纷增加财政支出以刺激经济，因此财政政策和货币政策的双重作用，令全球经 济在2009年迅速探底回升。　　但就今天而言，大部分国家的利率已经处于零位或者接近零位，因此下调空间十分有限。同时，大部分政府都为过高的债务，而 不得不紧缩开支或者增加税收，要这些政府再一次启动新一轮财政刺激几乎不太可能。因此，如果金融危机再袭，能够应对危机的政策工具已经少了很多。

最后，2008年金融危机发生的时机在21世纪头10年全球经济高速发展之后，前10年发展的积累，对实体经济的冲击产生一定的缓和作 用；如果这次金融危机再次发生，则是在2008年经济衰退之后的3年，实体经济比当时要脆弱很多，失业率也要高出很多，因此对普通老百姓的冲击会更大。

很多人觉得，发生在欧美的金融危机可能和自己关系不大，比如新加坡的经济增长依然高于欧美诸国，失业率仅为2%，房价也节节攀升，似乎天 下太平。但经历过2008年危机的人们都会记得，当欧美经济陷入衰退的时候，海外订单可能会大幅缩水，各银行不得不大规模裁员，同时海外雇员很可能由于失 业，不得不回去他们的家乡，造成人去楼空的结果。因此即便经济危机由欧洲而起，但由于国际经济的相关性，新加坡几乎难以避免被波及。 Continue (继续)