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mickeyd wrote:Personally I have a policy to never consume any food product that is from China. I would also be skeptical about Chinese CDs. I am too protective about my personal information as well as my cash.
I definitely agree with the food. I have bought some at Costco, by mistake.There have been too many instances of shortcuts taken with Chinese food. Plus, I don't know that their is an equivalent of the FDA in China (not that ours doesn't need a lot of improvement).
As stated earlier, I avoid food from China, not Chinese food, which I love.
As for Chinese CD's, I have done well with them and they do give some diversification. The bank is FDIC insured, so the only risk is currency risk. I can live with that.
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I saw the posts about how much can be withdrawn back to the US but I didn't notice that anyone has actually tried it yet.
My friend works for a billion-dollar company that does business in China with state-run businesses and his company is occasionally told there is no way to pay them "at the moment" because they have reached the limit of how much USD is allowed to be transferred out of the country. Not their company's limit, but country's self-imposed limit. There are many apologies for the delay and inconvenience, but the fact is his company can't get their money when they are supposed to - sometimes for months.
I don't know if this could ever apply to an individual's bank accounts, but it would seriously concern me.
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To be sure, there are risks which while I don't think they apply to Chinese CD's, will decrease the profitability of Chinese banks. The shadow banking system problem is something every establishment and central banking authority is concerned:
. . . an executive at a midsize bank told her he was offloading loans by repackaging them and selling them to customers, calling them wealth-management products. She called the process "a perfect way both to extend credit above the government's quota as well as to hide questionable loans," she says.
She questioned whether the loans would stay off the banks' balance sheets if they went bad, and she started to dig into the sector. By July 2010, shadow lending was soaring. There was a "pervasive understatement of credit growth and credit exposure," she wrote in a widely cited report at the time that found China undercounted credit growth in the first half of the year by 28%, or 1.3 trillion yuan ($212 billion).
Six months later, she and her team of two analysts unearthed another 1.6 trillion yuan in unnoticed credit in the form of discounted bills and acceptances, arcane forms of credit swapped between companies and banks.
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I tried fixing the link, but you need to take different approach. Use google: Charlene Chu Is the 'Rock Star' of Chinese Debt Analysis site:wsj.com - Google Search
, then click on the first link. No WSJ subscription necessary.
To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
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