Imagine working at a job where you are told to slow down, you’re doing too well.

Over the first nine months of 2009, new lending by Chinese banks has injected $1.3 trillion into the world economy, according to statistics from the People’s Bank of China, which functions as China’s central bank. The beneficiaries have included U.S.-based Southwest Airlines, the Netherlands’ Aercap airplane leasing company, Civil Aviation Authority in Dubai, and Foster’s brewery and Woolworths supermarket chain in Australia.

China’s banks have been signing so many new loan contracts so quickly that the country’s banking regulatory commission recently warned them to avoid the “blind” pursuit of size lest they run into the same troubles as their Western counterparts.

The bulk of loans from Chinese banks are staying in the country, and the central bank has not released an official breakdown between foreign and domestic loans. But bank analysts who have reviewed the public data estimate that the amount going to overseas companies has doubled in the past year to represent roughly 11 percent of all new loans, a shift that would appear to reflect an effort by China to diversify its holdings beyond U.S. Treasurys.




  1. ArianeB says:

    China may have all the money, but they have no pr0n.

  2. deowll says:

    Buying long term US government bonds would be a bad move for China in my view. In the long run we’er going to tank and either default or inflate our way out. Either way the lender gets hosed.

    I think the dollar lost something like 19% of its value in the last year on foreign markets. Who wants to get stuck holding crap like that?

  3. chuck says:

    China is too big to fail. Iceland was not.

  4. bill says:

    I had a job like that once!

    I was working at a GM parts warehouse, where the ‘union’ boss pinned me against the wall with a lift-truck and told me to “slow down, we’re working for some overtime”.

    really… I’ll never forget it.

    I’ve never slowed down since.

  5. Cursor_ says:

    So how is this any different than any other time since the fall of Rome?

    China has been a source of funds since Mongolians found out silk shirts would make for easier arrow removal when you where hit.

    People forget history.

    Cursor_

  6. Somebody says:

    “China has been a source of funds since Mongolians found out silk shirts would make for easier arrow removal when you where hit.”

    Yeah, it would be a shame to waste a good arrow.

  7. cfk says:

    Sounds like WaMu, circa January 2008.


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