Re:Baoshang collapse threatens China's economy, may trigger ...
by mrunkel on Sunday June 30, 2019 @06:08AM
(#20317400)
> In China, there seem to be no moral boundary in between just any legit banking business, and the most crazy high finance tricks being done with creditors money.
How is this a "chinese" problem? The recent sub-prime loan bullshit took place in the US and almost sank the global economy.
The bond pricing fixing took place in the UK and cost investors billions.
This is endemic to banking globally. The only thing that seemed to help was Glass–Steagall in the US which of course, banks got repealed because it worked too well.
Re:Baoshang collapse threatens China's economy, may trigger ...
by wbl on Sunday June 30, 2019 @11:06AM
(#20318571)
Could you please point to the entity whose collapse in the GFC Glass-Steagall would have prevented?
Re:Baoshang collapse threatens China's economy, may trigger ...
by paganel on Sunday June 30, 2019 @06:54AM
(#20317578)
Lehman was a model bank up until September 2008, at least as seen from the outside. The same goes for RBS (even though their acquisition of some of ABN Amro had already encountered some strong head-winds), UBS, Credit Suisse or Deutsche until very recently.
Re:Baoshang collapse threatens China's economy, may trigger ...
by benj111 on Sunday June 30, 2019 @09:40AM
(#20318139)
Cant speak for the others, but RBS wasn't a 'model' bank. RBS and Barclays were well known as the risker banks. I don't recall any concerns raised about Northern Rock, or the other ex building societies though. Maybe that's the interesting parallel here, the midsize banks aren't watched as closely and manage to drag down the too big to fail banks.
Moreover, I think most of local bankers think that's just the way it should be, thinking "boring Western style banking is just not for the high flyers like us"
Few things to tame out of this:
1. In China, a model bank can fail overnight
2. Central bank totally missed a sum on order of tenths of billions in cash being moved under it nose
3. All "good on paper banks" (which means all of them, given that is China) are under doubt now
4. Nobody knows how to tell of real risk indicators as Chinese banker got ungodly good with hiding elephants in their balance sheets
5. The alleged "private project" of a banker that has failed was a "risk free" real estate project.
6. Big banks will grow even more wary of lending to small banks with no diversity in leadership. In a big bank, you can at least be sure if 1 GM out of thousands does this, at least 1 another GM out of those thousands will try to impede him, but that's not the case with "1 man banks" which nearly all non big four banks are (which themselves evolved out of failed ITICs that were ran by party cadres https://zh.m.wikipedia.org/wiki/广东国际信托投资公司)