Friday, June 17, 2011

How About Those Chinese Bonds Yielding 8.1% ?


Chinese Bond Markets – An Introduction


  • While foreign investors have flocked to Chinese equities because of performance and correlation considerations, there is relatively less awareness of Chinese bond markets. This paper serves as an introduction to structure, trading venues, investor base and performance of Chinese bond markets for outside investors.
  • After more than a quarter century of development, Chinese bond markets have evolved into a RMB 15 trillion (more than USD 2 trillion) market across a broad variety of credit, maturity and investor profiles.
  • The market has a multi-layered structure, comprised of the national interbank market, the exchange market and bank counters, with the interbank market being the dominant trading venue.
  • Foreign institutional investors can invest in Chinese bonds by seeking regulator approval for QFII quota or access to the interbank market. Product creators and asset managers have hitherto focused on bringing out higher margin equity products. This may change as global investors seek to participate in the growth of Chinese capital markets without volatility of equities.
  • Over the five years ending 2008, the Chinese bonds in aggregate returned 8.1% annually in USD terms as measured by S&P/CITIC Composite Bond Index, a rate higher than those of U.S. and European bonds. RMB appreciation was a key return driver.
  • Correlations of Chinese bonds with U.S. and European bonds have been less than 10%. Correlation with Chinese equities is a low 1.6%.
  • Prospects for future evolution of the market include broadening of corporate bond markets, expansion of derivatives and risk management tools, and possible development of municipal bonds.

55 comments:

  1. Capital gains does not tax the passage of time, Mr Ignorant, it taxes inflation.

    If you had a brain, you'd be dangerous, boob.

    ReplyDelete
  2. The Philippines announced it will send its biggest warship, a World War II vessel, to a disputed part of the South China Sea after China said it was deploying one of its new coastal patrol vessels in the waters.
    The BRP Rajah Humabon, used by the U.S. against German submarines in World War II, will patrol around Scarborough Shoal, within waters claimed by China, the Philippine Star reported on its website. China sent the Haixun 31, a 3,000 ton vessel with a helicopter landing pad, to inspect foreign ships and oil facilities in disputed waters of the South China Sea, Hong Kong’s Ta Kung Pao newspaper reported yesterday.
    “The Navy conducts regular offshore patrols and we should not connect the deployment of Rajah Humabon to the deployment of this maritime vessel of China,” Eduardo Batac, spokesman of the Philippines’ department of defense, said in a press briefing today. “It’s part of routine patrols that are being conducted by the Navy.”
    Tensions in one of the world’s busiest shipping lanes have increased as the Philippines and Vietnam press ahead with oil and gas projects against China’s wishes. Exxon Mobil Corp., Talisman Energy Inc. (TLM), Forum Energy Plc (FEP) and Vietnam Oil & Gas Group, known as PetroVietnam, have operations in areas of the South China Sea claimed by China.

    ReplyDelete
  3. Update on making a mediocre thinker president because he is "a man of color" and succeeded a fool.

    Anyone think Red China would prevent one of their premier manufactures from opening a new expansion factory in another Chinese province, creating thousands of new jobs in the process?

    Would the greatest capitalist country in the world stop Boeing from creating 3000 jobs in the state of South Carolina?

    Only the dumbest president ever would put up with such an action with 9.1% unemployment.

    ReplyDelete
  4. Chinese Bond, eh?

    Whut could go wrong there?

    ReplyDelete
  5. .

    You should weep dhrw.

    Deductions are allowed. First in most cases, the full estate can pass to the wife without paying taxes. Second, since 2005, those same state taxes you weep about are deductible.

    The tax is charged on that portion of the estates over $5 million, $10 million when the spouse is counted.

    I assume as a farmer you have been receiving US crop subsidies and don't complain about them.

    So evidently you are sitting on property worth $5 - $10 million and you can't afford to replace the back window in the Mustang.

    Yeah, I'd weep too.

    .

    ReplyDelete
  6. .

    Should have said, "...$5 - $10 million minimum' and can't afford to fix the back window on the Mustang."

    .

    ReplyDelete
  7. Which is exactly the same thing,
    Shithead, because there's inflation built into the system.

    dwr

    ReplyDelete
  8. When the estate passes to the wife upon my demise, it won't do me a damn bit of good for buying a jet boat.

    I put her name fifty fifty long ago on anything I have anyway. In a divorce action there would be not much to talk about among us.

    dwr

    ReplyDelete
  9. They are Q but I'd rather not pay the state tax and forego the deduction.

    Yes, I received farm subsidies. Not much now.

    I've stated here many times aid to farmers should be targeted to those actually farming, and with a means test, and not to the landlords.


    Talk to your Congressman.

    Does anyone in Detroit receive any Federal money?

    dwr

    ReplyDelete
  10. One of the richest men in North Idaho used to drive around in an old 58 Chevy pickup. Practical guy.

    I'm proud of my hand me down convertible, only convertible I've ever had.

    dwr

    ReplyDelete
  11. hand me down convertible

    dwr

    ReplyDelete
  12. I'm not awake yet.

    dwr

    ReplyDelete
  13. .

    I haven't looked at the estate tax issue in some time but I thought they were trying to come up with something to help with small family-owned investments.

    Regardless, the tax isn't designed for guys like you even if you get caught up in it.

    It is for the top 1% of earners and those numbers are relatively small.

    These are the guys many call the 'producing class'; but in fact a good portion of them never "earned" anything. They either had it given to them by dad or they accumulated it through investment, guys like Soros, currancy speculator and manipulator.

    These guys accumulate money but they produce nothing tangible except more money. People will still argue, "Hey, regardless how, he earned the money, he deserves to keep it." What they forget are the many tax loopholes these people have been granted over the years making it much easier to actually accumulate more funds.

    The recent lack of action on any legislation regulating the hedge fund industry is a testiment to the power these guys and their money wield.

    You might also weep over the fact that these guys can afford armies of tax lawyers and lobbyists and you are stuck with the little lady from Moscow dhrw.

    .

    .

    ReplyDelete
  14. No, boob, time and inflation cannot be conflated.

    As I said, if you had a viable brain, we'd all be in danger.

    ReplyDelete
  15. .

    Does anyone in Detroit receive any Federal money?

    I'm sure they do. However, since I am about 40 miles north of the combat zone, I am not directly affected.

    .

    ReplyDelete
  16. O yes they can be "conflated" -fancy word for you to use, shithead - my accountant did so "conflate" when I said it's a tax on inflation and he said I like a tax on the passage of time better.

    I like it better too, which is why I use it.

    Why don't you go bowling today, give everyone one day of peace?

    dwr

    ReplyDelete
  17. .

    I have a t-shirt I like to wear.


    Detroit: Where the Weak are Killed and Eaten


    .

    ReplyDelete
  18. Don't bowl, gave it up.
    Bunch of fat folk, drinking, seemed to me.

    No, inflation cannot be conflated with time. The fact that:

    Average home equity plunged from more than 61% at the start of 2001 to 38% in the January-March quarter this year, the Federal Reserve said in a report Thursday. That drop comes as home prices in big metro areas have reached their lowest level since 2002.

    Factual analysis proves that point. Time passed and there was deflation, not inflation, in property values.

    If your accountant told you such a thing, that time passing = inflation, and you bought it, little wonder you cannot get the window in your car replaced.

    Both of you fellas, still living in the 20th century, time has passed you by.

    ReplyDelete
  19. :)

    Kinda like out in the forests deep, where big brave wolf picks on the weak first.
    :)

    Can you hear the gunfire from your place?

    I have a t-shirt I like to wear too. Says Sarah Palin Book Tour, and on the back a map of the USA with stars on the cities where her book tour stopped.

    Got to go, try not to miss me too much.


    dwr

    ReplyDelete
  20. boob, still mired in the past, while the whirled has moved on.

    ReplyDelete
  21. Time can now be conflated with deflation in the value of real property.

    Robert Shiller, the economist who co-founded the S&P/Case-Shiller index, said a further decline in property values of 10% to 25% in the next five years "wouldn't surprise me at all."

    ReplyDelete
  22. Obviously present spending levels bring unprecedented prosperity...

    Once again you bring up a non-sequiter. The conversation was about taxes. No one argues that spending doesn't have to be cut.

    The Dougo Creed, if you can't win one argument try talking about something else.

    ----

    Wow, you can write "non-sequiter" but you cannot discern logic when it is in front of your nose.

    Since you would rather cast aspersions than understand my point and further the conversation, I'll not waste my time trying to explain the logic to a mind enfeebled by prejudice.

    ReplyDelete
  23. That's Queerk's screed I was responding to.

    ReplyDelete
  24. Question to the peanut gallery:
    Is he really that stupid, or just blinded by stubborness?

    ReplyDelete
  25. Weiner will make over a million in pension benefits.

    The sacrifice of public service.

    Rufus and Queerk are right:

    Dems are better than Pubs.

    ReplyDelete
  26. I'm sure the Republicans' Pension benefits are equal to those of the Dems, Doug.

    ReplyDelete
  27. explain the logic to a mind enfeebled by prejudice.

    It's the vegetarianism, Doug, tough self inflicted burden to overcome.

    dwr

    ReplyDelete
  28. Hmmm,

    Dollar's down

    Oil's down

    Impossible

    ReplyDelete
  29. Total Federal tax receipts, as a percentage of GDP has been under 15% for the last two years and is projected at 14.4%, this year.

    Tax Policy Center

    Tax receipts have not been at such a low level of the GDP, since 1950.

    61 years ago.

    During the Reagan tenure, a tad over 18% of GDP looks to be the average for Federal revenue.

    When Clinton/Newt ran a surplus ...
    Federal revenue was 19.9% of GDP.

    2009, 2010, 2011 projected ... 14.4% of GDP.

    Today, with total Federal revenues, measured as % of GDP, are at a 61 year low, the Federals are facing a cash flow crisis.

    ReplyDelete
  30. What is the value of Mark Foley's pension, doug?

    Weiner served about 20 years, Foley 11.

    ReplyDelete
  31. Tax receipts have not been at such a low level of the GDP, since 1950.

    That may or may not be correct.

    What is correct

    Federal revenue has not been at such a low level of the GDP, since 1950.

    ReplyDelete
  32. I've thought for awhile, now, that Clinton/Gingrich had it about right.

    ReplyDelete
  33. Dems are better than Pubs.

    Your an idiot Doug.

    How many times do we have to say it before it gets through that pina colada saturated head of yours?

    The Dems are not better than the GOP, just as the GOP is no better than the Dems. They are all dicks.

    You insist on jumping to the illogical conclusion that because the Dems are bad, the GOP is good.
    You mention specific things the Dems do that are fucked up or stupid and from that, ignoring what the GOP does that is fucked up or stupid, draw the conclusion that the GOP is better than the Dems.

    Try telling the cop when your stopped for speeding that "Hey, that other guy was going faster than me" and see how far it gets you.

    Denseness thy name is Doug.

    .

    ReplyDelete
  34. Weiner served? Yeah, he served alright.

    ReplyDelete
  35. He well represented his constituents, gag.

    Elected and re-elected ten times.

    He represented the people of New York, in more ways than one.

    ReplyDelete
  36. Try telling the cop when your stopped for speeding that "Hey, that other guy was going faster than me" and see how far it gets you.

    There is no 'cop' and the other guy was going faster.

    Vegan brain damage is thy middle name.

    By the way Q if you can get me even 5 million, before I die, there's a big commission in it for you. The winners here, if there is that sort of thing in life, are grandfathers great grandson and great grand daughter.

    And I'm not that, and it won't be completed in my lifetime.

    I do get about 2500/year on the alfalfa, though.

    dwr

    ReplyDelete
  37. .

    And I'm not that, and it won't be completed in my lifetime.

    Then why the hell did you even bring it up?

    .

    ReplyDelete
  38. The report cites estimates of what price it might take to get large volumes of shale gas out of the ground. Some of the easiest and highest flowing wells may make a profit at current prices around $4 mcf. But harder-to-get gas will likely cost more than $7 mcf and possibly as much as $11.50 mcf. What's clear is that ramping up shale gas production won't be cheap. As my driller friend opined, "We can have cheap natural gas or we can have plentiful natural gas, but we're not going to have cheap, plentiful natural gas."

    But just how plentiful will that natural gas be even with high prices? Forecasts from the U.S. Energy Information Administration (EIA)--which have tended to be too optimistic--suggest that shale gas will only lift U.S. natural gas production modestly between now and 2035.


    Shale Gas - Not a "Game-Changer" After All?

    ReplyDelete
  39. The NYTimes is off and running with the Fannie Mae story.

    Who Is James Johnson?
    By DAVID BROOKS

    Most political scandals involve people who are not really enmeshed in the Washington establishment — people like Representative Anthony Weiner or Representative William Jefferson. Most scandals involve spectacularly bad behavior — like posting pictures of your private parts on the Web or hiding $90,000 in cash in your freezer.

    But the most devastating scandal in recent history involved dozens of the most respected members of the Washington establishment. Their behavior was not out of the ordinary by any means.

    For that reason, the Fannie Mae scandal is the most important political scandal since Watergate. It helped sink the American economy. It has cost taxpayers about $153 billion, so far. It indicts patterns of behavior that are considered normal and respectable in Washington

    ReplyDelete
  40. .

    The NYTimes is off and running with the Fannie Mae story.

    They also generally applaud Obama's 'outreach to business' but fail to mention that Bill Daley, Obama's current Chief of Staff, was a board member at Fannie Mae.

    All can be forgiven if there is some perceived political gain.

    .

    ReplyDelete
  41. You brought it up at 9:10am EDT.
    You the Big Cheese that brought it up. Not I. Said I was worth somethin' when I'm not.

    dwr

    ReplyDelete
  42. Whatever happened to the misery index by the way?

    Headline says we are the most miserable we've been in 28 years.

    dwr

    ReplyDelete
  43. Ah, the article was about the misery index--

    When it comes to measuring the combination of unemployment and inflation, it doesn’t get much more miserable than this.

    In fa
    ct, misery, as measured in the unofficial Misery Index that simply totals the unemployment and inflation rates, is at a 28-year high, reflective of how weak the economic recovery has been and how far there is to go.

    The index, first compiled during the soaring inflation days of the 1970s by economist Arthur Okun, is registering a nausea-inducing 12.7—9.1 percent for unemployment and 3.6 percent for annualized inflation—a number not seen since 1983. The index has been above 10 since November 2009 and had been under double-digits from June 1993 through May 2008.


    It's obvious Quirk is feeling miserable today, being so grumpy.

    dwr

    ReplyDelete
  44. Maybe he's just a (pompoua) Asshole.

    ReplyDelete
  45. Whatever happened to the misery index by the way?

    Headline says we are the most miserable we've been in 28 years.

    dwr

    ---

    Makes you wonder how we got that way.

    Rufus and Queerk never have anything negative to report about Nancy, Harry, or The Organizer.

    ReplyDelete
  46. "It has cost taxpayers about $153 billion, so far. "

    ---

    Brooks has his head up his ass, per usual:

    It's already cost CITIZENS Trillions in lost Equity, and is a primary factor in starting the tanking of the ecomomy prior to the arrival of the big spenders and then the election of The Organizer two years later.

    Misery Index, indeed.

    ReplyDelete
  47. Thoe Original misery index was unemployment, inflation, and interest rates. Got up into the thirties under Carter. Pretty much stayed there, I guess, until Voelker administered the castor oil.

    ReplyDelete
  48. .

    You the Big Cheese that brought it up. Not I. Said I was worth somethin' when I'm not.


    The "it" was you're complaining about he estate tax and how hard it was going to be on you. You were the one who brought that tax up first. Now, after a half a dozen posts, if I read your last post right, it appears you are not even affected by it.

    .

    ReplyDelete
  49. .

    Rufus and Queerk never have anything negative to report about Nancy, Harry, or The Organizer.

    Nonsense.

    The fact that you ignore them, not our problem.

    Reid and Pelosi? When they were in power, I had a constant stream of vindictive I aimed at them. Today they are non-endities. Everything is happening in the House.

    If Reid or Pelosi ever get in a position to actually influence events, I'll be on them too.

    The reason you ae aware of criticism of the GOP is because every time you come here you try to defend them. My posts are merely responses to crap floating in from the islands.

    You have political hyperglycemia. The high blood sugar from all that Kool-aid you drink is affecting your brain.

    Be careful standing up or you will fall over.

    .

    ReplyDelete
  50. I was pissing and moaning about the capital gains tax, Quirk.

    Not being dead yet I don't know anything about estate taxes.

    dwr

    ReplyDelete
  51. .

    I was pissing and moaning about the capital gains tax, Quirk.

    Apologies.

    My bad.

    I obviously got confused with your talk about the passage of time.

    .

    ReplyDelete
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