An investor watches stock prices at a brokerage office in Beijing, China July 6, 2018. REUTERS/Jason Lee
Reuters: Pain and pressure: market turmoil pushes some China funds to the brink
SHANGHAI (Reuters) - It’s already been a harsh year for Chinese funds, hit by new rules aimed at reining in debt in the country’s financial system. Now, the sell-off in China stocks induced by trade war anxiety further threatens their health and for some, their survival.
Case in point: private fund house Nanjing Hu Yang Investment Co has seen its assets under management halve to 50 million yuan ($7.5 million) over the past year on redemptions and investment losses.
Its chairman, Zhang Kaihua, said he is putting his funds, which bet on consumer stocks, into “a state of dormancy”. He’s also stopped publishing fund performances and shelved capital raising plans.
“Our only hope is that our existing clients can stick with us so that we can survive,” he said, adding that he has seen many of his peers drop out of the market.
In the past when market turmoil has hit China’s fund industry, such as in 2015, it has managed to bounce back on loose monetary policies and relaxations in rules for the sector.
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WNU Editor: My friends in China are telling me that they believe that the U.S. will throw in the towel on this trade war, and that the status quo of trade deficits will return. I do not know where they are getting their information , but I do know that this observation from Reuters is spot on .... China's 'firefighter' vice president avoids flames of U.S. trade war (Reuters). As long as Vice President Wang Qishan remains on the sidelines, there is no U.S. - China trade deal on the table.
4 comments:
Well, the Chinese perception is the same as the Russian's have at the USSR time.
Hahaha
God I'm so glad I listened to my adviser and pulled my money out of China. Should've done it earlier this year, admittedly, but I still avoided much of the blood bath :) China is toast.
China just keeps embarrassing itself lately...talking about a trade war.. this is not a trade war... in the US you don't even notice anything about it.. the stock markets are rising because everyone knows the outcome of this. China is f*ed.
Worse yet, China's myth of an unavoidable "Chinese Century" is completely gone. Think about it.. the US economy (with less than 1/4 of the people compared to China!) is squashing China like a pesty fly, without even noticing it. China's official gbp numbers also turn out to be faked by up to 30%(!!). This is something that the market hasn't really digested yet either.. means China makes perhaps as little as 8-9trillion/year... that's just twice as much as Germany makes.. and they need less than 5% of people to do it (or in other words.. China needs 20 times more people to accomplish what Germany does..)...
And then think about this: the US economy is growing already by 4.5%, and Trump aims for 5%. Now that may not sound much to you, but it is a mature economy of 20 trillion (more than twice than China) in size... When you have 20 trillion and you grow it by 5% that's insane.. China would have to grow by more than 10% now to keep up with it.. it's impossible.. China grows at most by 5.5% this year. This war is over, and the Chinese leadership better find a way to save face, because Trump won't help them doing so, unless they stop the North Korea nonsense.
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