EoE Archive001 - EoE001

EOE001 At-a-Glance (Demo)Session: 28th May '16   Print Date: 7th May '16

- how many came? 2 people (WKJ; SDC)

- what we covered

Special report : China

1. Big but brittle

2. Breaking bad

3. Dark and stormy

4. Risky returns

5. Power to the party

6. Nowhere to hide

7. Pain and prosperity

- detail 

Contents Capital markets: Risky returns Politics: Power to the party

Interpretation Capital Markets Finance in China (Special Report) = Finance in China: Big but Brittle +Banks: Breaking Bad +Shadow banks: Dark and Stormy +Capital markets: Risky Returns +Politics: Power to the Party +Global impact: Nowhere to Hide +The way forward: Pain and Prosperity China’s capital markets and politics are some of the factors that’s making finance in China massive but shaky.

Detailed Contents Capital markets: Risky returns China is struggling to unleash the power of stocks and bonds Voices of reason Politics: Power to the party The state wields extensive control. So why is the financial system so unruly? The greater of two goods Let them go bust

Detailed Interpretation  (rephrase->details->trimming->conclusion) Capital Markets: Risky Returns# China is struggling to unleash the power of stocks and bonds China’s capital markets offer risky returns; they are trying hard to make their equity and bond markets to fully realize their growth potentials. Step One: Demand details (6W1Hs, ellipsis, p.p.) What creates risky--why risky returns? ---(Shanghai’s markets)…in their infancy…beset by corruption, price manipulation, insider information, government intervention and a mob-mentality trading style… volatile….so irrational. ---(China’s stockmarket)…a casino…propensity for wild swings and lawlessness…over the past year. Blue-chip stocks more than doubled …(debt-fuelled buying before crashing, landing not far from where they started.)  (Officials)…ordering big shareholders…refrain from selling… pumping money into the market…drafting state-owned brokerages and banks into a “national team” to buy shares…detained dozens of investors, bankers and regulators… How to realize growth potentials?  In equity market: ---With a thriving stockmarket, companies could fund themselves with more equity, not just debt.  In bond market: ---A healthy bond market would take pressure off overburdened banks. In both markets: ---Just as significant, transparent markets are needed to help investors price capital properly and press companies to improve their governance. Why bother?  (--esp. when Chinese banks are the ‘beating heart’ of its financial system? (=when pvt.& pub sectors fund themselves primarily through banks?) ---To develop properly, China must get its capital markets right ∴ Capital Markets: Risky Returns#  Step Two: Check Coherence (fight if necessary) What are the reasons? (examples, quotations, etc.) Capital markets: Risky returns Voices of reason

Written by SDC