Top Chinese banks are involved in Ponzi financing of investment deals, offering interest rates over 7% to depositors, to finance real estate projects gone bust and other projects whose assets are not even disclosed.
Banks label these schemes "Wealth Management Products" (WMPs) but any individuls foolish enough to invest in them are going to lose money, perhaps all of it.
NEW YORK (Reuters) - AT&T Inc will buy Leap Wireless International Inc for $1.19 billion, paying almost double the current value of the prepaid mobile service provider as major U.S. carriers scramble to acquire valuable wireless spectrum.
ATHENS (Reuters) - Greece would need an additional 13-15 billion euros to finance a two-year extension to meet its budget targets but is confident of bridging that gap without burdening European taxpayers, Finance Minister Yannis Stournaras told Reuters on Tuesday. He also confirmed that the country's fiscal gap to hit its 2013 and 2014 targets remained at 13.5 billion euros. Athens has been discussing fiscal measures worth that amount with its European Union and International Monetary Fund lenders. ...
EMU officials in Brussels want to see specific details on how Spain will reduce its budget deficit to 3% of GDP in 2013. Given the 2011 deficit was 8.5%, EMU officials do not believe Spain, nor should anyone else. The targets will not be met.
Moreover, some in Brussels accuse Spain of artificially inflating the 2011 deficit so as to better meet its interim target.
Those are contradictory accusations actually. If the deficit is artificially inflated, it should be easier to make the targets.
The EU has accused Spain of overstating its 2011 budget deficit thus making it easier to make progress in 2012. Furthermore the EU is upset about delays in austerity measures ahead of regional elections next month.
The Prudent Investor submits:
Is China getting ready to tighten credit? In a most pragmatic move 3 rather hawkish economists have been added to the monetary policy committee of the People's Bank of China (PBOC), according to a report on chinadaily on Wednesday.
PARIS (Reuters) - Greece should be allowed more time to meet deficit targets set by international lenders provided the crisis-racked nation is sincere about reforming its economy, French Prime Minister Jean-Marc Ayrault said on Sunday. In an interview posted on news website Mediapart, Ayrault also said that a planned 120 billion-euro ($155.87 billion) European Union stimulus package was not big enough and that the European Central Bank had yet to play the role of a "real" central bank. "The answer must not be a Greek exit from the euro zone," Ayrault was quoted as saying. ...
Portugal can still reach its 2012 budget targets but the risk of failure has grown significantly, officials from the European Commission and International Monetary Fund said on Tuesday.The goal of reducing Portugal's public debt to 4.5 percent of gross domestic product this year is achievable but might be hampered by a large drop in tax revenues in the slowing economy, the European Union's executive arm said.It was reporting on progress made since Portugal was thrown a lifeline worth 78 billion euros ($96 billion) in May 2011 to prevent it from going under.
France could be the next European country to face economic stumbling blocks with up to 10 billion euros needed to be cut this year and another 33 billion by 2013 in order to meet European deficit targets, auditors said Monday.