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China Is Hunting for Foreign Buyers for Its Sovereign Debt

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Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#51

Post by whynotminot »

microdrum wrote: post #28
cm2187 wrote: post #3

Can someone explain to me why an investor would want to invest in a foreign debt and currency from a country that has capital controls and a history of undervaluing its currency?

Interesting line re: this from last year's moviee Crazy Rich Asians: "There is a Hokkien phrase, 'Gar gee nang.' It means, our own kind of people. And you're not our own kind." "Because I'm not rich? 'Cause I didn't go to a British boarding school, or I wasn't born into a wealthy family?" "You're a foreigner. American. And all Americans think about is their own happiness. "Don't you want Nick to be happy?" "It's an i…

China likes to project an aura of inevitability brewing for eons and now thundering forward, but the ruling party is very aware of how tenuous its grip truly is.

The short term economic decisions highlight how much they fear a downturn could upend the party's control.

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#52

Post by rfreytag »

microdrum wrote: post #28
cm2187 wrote: post #3

Can someone explain to me why an investor would want to invest in a foreign debt and currency from a country that has capital controls and a history of undervaluing its currency?

Interesting line re: this from last year's moviee Crazy Rich Asians: "There is a Hokkien phrase, 'Gar gee nang.' It means, our own kind of people. And you're not our own kind." "Because I'm not rich? 'Cause I didn't go to a British boarding school, or I wasn't born into a wealthy family?" "You're a foreigner. American. And all Americans think about is their own happiness. "Don't you want Nick to be happy?" "It's an i…

The PRC is playing a long game with the Belt and Road initiative as well as incrementally building and claiming islands within the South China Sea laying a real claim to the waters there-round. The PRC inroads in Africa are significant. With a minimum of grandstanding China as moved quite far geopolitically over the last decade and more.

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#53

Post by seppin »

cm2187 wrote: post #15
networkimprov wrote: post #6

China's leaders have historically shied away from this policy, so as to protect itself from the whims of foreign investors, and maintain maximum control over its economy. This reversal may point to a crisis beneath the surface, as it's probably not their preferred path...

If the debt is in yuan and under chinese law, foreign investors don't have much say on their economy.

if they stop buying once they start, they certainly do

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#54

Post by jcranmer »

microdrum wrote: post #28
cm2187 wrote: post #3

Can someone explain to me why an investor would want to invest in a foreign debt and currency from a country that has capital controls and a history of undervaluing its currency?

Interesting line re: this from last year's moviee Crazy Rich Asians: "There is a Hokkien phrase, 'Gar gee nang.' It means, our own kind of people. And you're not our own kind." "Because I'm not rich? 'Cause I didn't go to a British boarding school, or I wasn't born into a wealthy family?" "You're a foreigner. American. And all Americans think about is their own happiness. "Don't you want Nick to be happy?" "It's an i…

It was the same thing in the movie. Immediately after that exchange, Rachel explains how she turned down Nick because it would mean cutting him off from his family, at which point Eleanor berates her for turning down a winning hand. For as much as Eleanor talks about the importance of suborning happiness for things that last, Eleanor is just as quick as she accuses the Americans of being of pandering to happiness.

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#55

Post by jazzyjackson »

aristophenes wrote: post #50
jazzyjackson wrote: post #49

Earlier quoted context omitted.

Given that the UK & USA has a habit of showing up with a Navy when someone refuses to trade (thinking of the perry expedition, the opium wars) I'm left wondering what a good trade actor looks like.

Is your claim that good trade is not possible? I think in the 150 years since your examples there have been many positive examples of trade beneficial to both parties, and hardly any that are harmful, though there should be a handful. For example, South Koreas economy, in a single persons lifetime, has grown 60x per person, inflation adjusted. An entire nation pulled out of poverty. https://tradingeconomics.com/south…

My claim wasn't about trade being good or bad, rather, if an entity working out of self-interest is a good or bad actor.

I'm also not entirely sure the ends justify the means when it comes to threatening war. Having the power to write the constitutions of other countries costs the US economy a pretty penny.

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#56

Post by nly »

anonymfus wrote: post #13
projectramo wrote: post #7

Earlier quoted context omitted.

They might do it for 3x the return: "China’s government bonds were among the world’s best performers in 2018, returning 7.7 percent, while U.S. Treasuries earned 0.8 percent, ICE Bank of America Merrill Lynch data show. That gain is in yuan terms, however, and the yuan dropped 5.4 percent against the U.S. dollar." So 7.7 - 5.4 = 2.3% which is almost 3x 0.8% return on US Treasuries.

>So 7.7 - 5.4 = 2.3% Seriously? 0.946 * 1.077 = 1.018842 So about 1.9% which is about 2.4x 0.8% return on US Treasuries.

And shaved both ways in the forex market

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#57

Post by jcranmer »

aristophenes wrote: post #50
jazzyjackson wrote: post #49

Earlier quoted context omitted.

Given that the UK & USA has a habit of showing up with a Navy when someone refuses to trade (thinking of the perry expedition, the opium wars) I'm left wondering what a good trade actor looks like.

Is your claim that good trade is not possible? I think in the 150 years since your examples there have been many positive examples of trade beneficial to both parties, and hardly any that are harmful, though there should be a handful. For example, South Koreas economy, in a single persons lifetime, has grown 60x per person, inflation adjusted. An entire nation pulled out of poverty. https://tradingeconomics.com/south…

> Is your claim that good trade is not possible? I think in the 150 years since your examples there have been many positive examples of trade beneficial to both parties, and hardly any that are harmful, though there should be a handful.

More like 70 years. It was only around WWII that the US kicked the theme of trade-or-death running its foreign policy. The early 20th century has several wars you don't read about in history books where the US basically sends in the marines to topple a government that's antagonizing US commercial interests.

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#58

Post by codycraven »

hermitdev wrote: post #31
pstrateman wrote: post #4

Earlier quoted context omitted.

Investors with other peoples money receiving fees based on annual return. What do they care about the risks?

> What do they care about the risks? Plenty. You dont last long in finance if you take outsized risks and lose your clients money. Various firms and investors have varying risk tolerances, but any finance firm worth anything has a risk team that is daily monitoring these things.

Like garbage mortgages? While I'd really like to believe companies will act appropriately for their own long-term success, in reality the people working there look out for themselves and are just a job hop away from a fresh start at a different finance company. I see this in tech all the time where developers at agencies pound out horrible code with no long-term care for what they deliver, just that they meet the request in the here and now.

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#59

Post by nate_meurer »

jhwang5 wrote: post #37
microdrum wrote: post #28

Earlier quoted context omitted.

Interesting line re: this from last year's moviee Crazy Rich Asians: "There is a Hokkien phrase, 'Gar gee nang.' It means, our own kind of people. And you're not our own kind." "Because I'm not rich? 'Cause I didn't go to a British boarding school, or I wasn't born into a wealthy family?" "You're a foreigner. American. And all Americans think about is their own happiness. "Don't you want Nick to be happy?" "It's an i…

Way to get cultural insights into China from a Hollywood movie bro

OP just said it was interesting, that's all. Do you have any insights of your own to add?

Re: China Is Hunting for Foreign Buyers for Its Sovereign Debt

#60

Post by nate_meurer »

jazzyjackson wrote: post #49
ianai wrote: post #27

Earlier quoted context omitted.

This and related thoughts lead me to wonder whether China may soon face a Greece like meltdown. They’ve established themselves as bad trade actors.

Given that the UK & USA has a habit of showing up with a Navy when someone refuses to trade (thinking of the perry expedition, the opium wars) I'm left wondering what a good trade actor looks like.

A habit... really? Based on examples from two centuries past?
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