"Borrow New and Repay Old" or "Deleveraging"
After many years of managing an economy fundamentally driven by credit-fuelled investment, exports, construction of infrastructure and real estate, China's authorities have decided to transform their investment-propelled economy into a consumption-driven one, as well as to start deleveraging banks in order to avoid a credit crisis that could substantially imperil their economic and financial future.
Although anyone who comes across this website and has a quick glance at the debt chart below could instantaneously conclude that the PBoC doesn’t have a clue about risk management, he or she would be wrong.
And if that person believes in what I said just because it’s on the internet, then he or she would be doubly wrong.
Keep reading and you’ll find out ;)
The year 2013 is going to be remembered for a myriad of reasons. Some investors and speculators may have already sent a “Thank you!” note to the bearded man who made possible the amazing profits experienced by those who decided to buy the S&P 500 at an early stage. However, those who invested in Emerging Markets and precious metals might have had a tough time throughout the year.
Although each one resembles the other, if you have Santa Claus in mind, I'll be sorry to disappoint you. The catalysts were Ben Bernanke and his famous unconventional monetary policy decisions.
The driving factors last year were QE and the "taper tantrum."
I'm glad I did a couple interesting things in my life when I was younger. I'll describe them in this post.
I googled "how to make money on the internet" and paraphrased it a hundred times. All I found was Google Adwords/Adsense-type tips. Naah... I wasn't interested.
However, I also found one CFD webpage which offered a special Toolbar that included links to real-time charts and prices for Gold, Oil, EURUSD and the Dow Jones Industrial Average. Since then, I started checking their prices constantly from time to time.